UNITED STATES

                   SECURITIES AND EXCHANGE COMMISSION

                         Washington, D.C. 20549

                               FORM 10-K


             ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                 OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended  May 30, 1998  Commission file number 1-11479
                           ------------                         -------

                             E-Z-EM, Inc.
         ------------------------------------------------------
         (Exact name of registrant as specified in its charter)

                Delaware                           11-1999504
      -------------------------------          -------------------
      (State or other jurisdiction of           (I.R.S. Employer
      incorporation or organization)           Identification No.)

        717 Main Street, Westbury, New York               11590
      ----------------------------------------          ----------
      (Address of principal executive offices)          (Zip Code)

Registrant's telephone number, including area code  (516) 333-8230
                                                    --------------

Securities registered pursuant to Section 12(b) of the Act:  Class A
   Common Stock, par value $.10 and Class B Common Stock, par value $.10

Securities registered pursuant to Section 12(g) of the Act:  None

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.

                      Yes   /X/         No   / /

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy
or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K. [ X ]

The aggregate market value of the registrant's voting Class A Common
Stock held by non-affiliates on August 3, 1998 was $19,871,000.

On August 3, 1998, there were 4,035,346 shares of the registrant's
Class A Common Stock outstanding and 6,012,398 shares of the
registrant's Class B Common Stock outstanding.

                  DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Proxy Statement for registrants 1998 Annual Meeting of
Stockholders to be held October 20, 1998 are incorporated by reference
in Part III of this Form 10-K Report.


                              Page 1 of 77
                        Exhibit Index on Page 35
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

                                 INDEX

                                                               Page
                                                               ----
PART I:

     Item l.  Business                                           3

     Item 2.  Properties                                        15

     Item 3.  Legal Proceedings                                 15

     Item 4.  Submission of Matters to a Vote of Security
              Holders                                           16


PART II:

     Item 5.  Market for Registrant's Common Equity and
              Related Stockholder Matters                       17

     Item 6.  Selected Financial Data                           18

     Item 7.  Management's Discussion and Analysis of
              Financial Condition and Results of Operations     19

     Item 8.  Financial Statements and Supplementary Data       25

     Item 9.  Changes in and Disagreements with Accountants
              on Accounting and Financial Disclosure            25


PART III:

     Item 10. Directors and Executive Officers of the
              Registrant                                        26

     Item 11. Executive Compensation                            29

     Item 12. Security Ownership of Certain Beneficial
              Owners and Management                             32

     Item 13. Certain Relationships and Related Transactions    34


PART IV:

     Item 14. Exhibits, Financial Statement Schedules and
              Reports on Form 8-K                               35








                                  -2-
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                                 PART I


Item 1.  BUSINESS

(a)  GENERAL DEVELOPMENT OF BUSINESS

     E-Z-EM, Inc. (the "Company" or "E-Z-EM"), organized in Delaware in
1983, has been in business for over 36 years, and has its corporate
offices located at 717 Main Street, Westbury N.Y. 11590.  The Company
is primarily engaged in developing, manufacturing and marketing
diagnostic products used by radiologists and other physicians during
image-assisted procedures to detect anatomic abnormalities and
diseases.  The Company also designs, develops, manufactures and
markets, through its wholly-owned subsidiary, AngioDynamics, Inc.
("AngioDynamics"), a variety of therapeutic and diagnostic products,
for use principally in the diagnosis and treatment of peripheral
vascular disease.  These products are primarily used by interventional
medicine practitioners during minimally invasive diagnostic and
surgical procedures.  Thirty-six percent (36%) of the Company's sales
were to customers outside the U.S. during 1998.

     E-Z-EM contrast systems consist of specially developed powdered
and liquid barium sulfate formulations and consumable medical devices,
which function together as a system, for examination of the various
parts of the gastrointestinal ("G.I.") tract.  Contrast systems are
used in X-ray, CT-scanning and other imaging examinations.  The G.I.
tract is commonly referred to as the digestive system and consists of
the pharynx, esophagus, stomach, small intestine (or small bowel) and
colon.  E-Z-EM manufactures a broad spectrum of barium sulfate products
for different uses in G.I. tract examinations.  Each E-Z-EM barium
sulfate formulation is tailored to that portion of the G.I. tract to be
examined, and to the procedures employed by radiologists in each
examination.  Based upon sales, the Company believes that it is the
leading worldwide producer of barium sulfate contrast systems for use
in G.I. tract examinations.

     The Company also competes in areas related and complementary to
its basic contrast systems business, categorized as non-contrast
systems.  Non-contrast systems include:  diagnostic radiology devices,
custom contract pharmaceuticals, gastrointestinal cleansing laxatives,
X-ray protection equipment, and immunoassay tests.  See "Narrative
Description of Business".

     The Company's sales of contrast and non-contrast systems,
collectively the diagnostic ("Diagnostic") products industry segment,
net of intersegment eliminations, increased 5% during 1998 as compared
to 1997.

     The Company manufactures and markets, through AngioDynamics, three
differentiated product groups for use during interventional procedures:
angiography products, therapeutic products and stent/angioplasty
products.  AngioDynamics also manufactures and sells angiographic and
stent/angioplasty products on an O.E.M. basis.  Collectively these
products are classified as the AngioDynamics products industry segment.
See "Narrative Description of Business".

     During 1998, AngioDynamics product sales, net of intersegment

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eliminations, increased 9%.  Domestic sales increased by 27% due to
market share growth, while international sales decreased by 24% due to
a decline in the sale of coronary AngioStent(TM).  The AngioDynamics
segment results for 1998 were adversely affected by a non-cash
accounting charge of $4,121,000, relating to an impairment of certain
long-lived assets used in the cardiovascular market.  The Company
determined that the revenue potential of this technology, as it relates
to the cardiovascular market, was impaired due to increased competition
and price erosion for coronary stents and angioplasty products and the
Company's strategic decision to commercially exploit this technology in
the interventional radiology market.  The Company is seeking a
strategic business partner with an existing cardiovascular sales and
marketing franchise in order to be successful in the cardiovascular
market, although there can be no assurances that such a partner can be
found.

     Unless the context requires otherwise, all references herein to a
particular year are references to the Company's fiscal year.

(b)  FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS

     The Company is engaged in the manufacture and distribution of a
wide variety of products that are classified into two industry
segments:  Diagnostic products and AngioDynamics products.  Diagnostic
products encompass both contrast systems, consisting of barium sulfate
formulations and related medical devices used in X-ray, CT-scanning,
ultrasound and Magnetic Resonance Imaging ("MRI") imaging examinations,
and non-contrast systems, including diagnostic radiology devices,
custom contract pharmaceuticals, gastrointestinal cleansing laxatives,
X-ray protection equipment, and immunoassay tests.  AngioDynamics
products include angiography, therapeutic and stent/angioplasty medical
devices used in the interventional medicine marketplace.

     The net sales and operating profit (loss) of each industry segment
and the identifiable assets, depreciation and amortization, and capital
expenditures attributable to each industry segment are set forth in
Note O to the Consolidated Financial Statements included herein.

(c)  NARRATIVE DESCRIPTION OF BUSINESS

     DIAGNOSTIC PRODUCTS

     Diagnostic products include both contrast systems, consisting of
barium sulfate formulations and related medical devices used in X-ray,
CT-scanning and other imaging examinations, and non-contrast systems,
including diagnostic radiology devices, custom contract
pharmaceuticals, gastrointestinal cleansing laxatives, X-ray protection
equipment, and immunoassay tests.

     Contrast Systems

     Contrast systems, using barium sulfate formulations as contrast
media together with consumable medical devices, have been E-Z-EM's
principal business since the Company's organization over 36 years ago.
For over 80 years, barium sulfate has been the contrast medium of
choice for virtually all G.I. tract X-ray examinations.  It has the
longest history of use among all contrast media.  Barium sulfate is
preferred among G.I. tract contrast media because it has a high

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absorption coefficient for X-rays.  In addition, it is biologically
inert, insoluble in water and chemically stable.  Barium sulfate for
suspension is listed in the U.S. Pharmacopeia.  The use of properly
formulated barium sulfate suspensions permits the visualization of the
entire G.I. tract.

     The Company's contrast systems are designed for a variety of
radiologic procedures.  In single contrast procedures, a portion of the
G.I. tract is filled with barium sulfate to produce a diagnostic image
of the tract's contours.  In double contrast procedures, gas or air is
used to distend the G.I. tract after coating with a high density barium
sulfate suspension.  This produces a significantly clearer diagnostic
image of the tract's surface than that obtainable through the use of
single contrast procedures.  In computed tomography procedures, known
as "CT-scanning", a specially formulated low density barium sulfate
product is used to visualize the G.I. tract and thus significantly
enhance the radiographic image.

     Contrast systems provide radiologists with a range of effective
and convenient powdered and liquid product formulations tailored to
single contrast, double contrast or CT-scanning procedures.  Many of
the Company's products are functionally packaged in consumable
dispensing containers.  The Company believes that it currently has the
broadest barium sulfate product line of any worldwide manufacturer and
is continuing to develop additional formulations for modern X-ray
techniques.  E-Z-EM also sells accessory medical devices for use in
contrast system procedures, including empty enema administration kits
and components.  Sales of contrast systems declined 1% during 1998 as
compared to 1997.

     Non-Contrast Systems

     The Company also competes in areas related and complementary to
its basic contrast systems business, categorized as non-contrast
systems.  Non-contrast systems include:  diagnostic radiology devices,
custom contract pharmaceuticals, gastrointestinal cleansing laxatives,
X-ray protection equipment, and immunoassay tests.  Sales of non-
contrast systems increased 20% during 1998 as compared to 1997.

     The Company's line of diagnostic radiology devices include
electromechanical injectors and syringes, needles, trays and ancillary
devices used during a variety of diagnostic radiologic and ultrasound
procedures.  This product grouping includes the PercuPump Touchscreen(TM)
with EDA injector ("PP with EDA"), which is designed to inject contrast
media into the vascular system for visualization purposes during CT
procedures.  The PP with EDA, introduced in 1998, is the first CT
injector designed to aid in the detection of extravasation, an
accidental infiltration of contrast media into surrounding tissue.  The
PP with EDA is comprised of an electromechanical injector, a consumable
syringe, and an EDA detector patch.  Other diagnostic radiology devices
include entry needles, biopsy needles, trays and ancillary products used
during mammography, amniocentesis and other specialty procedures.

     Custom contract pharmaceutical and cosmetic products are
manufactured on a contract basis by the Company's Canadian subsidiary.
Pharmaceutical products include liquid vitamins and antacids,
decongestants, cough medicines and vaporizing ointments.  Cosmetic
products include tanning and sunscreen lotions and bath powders.

                                  -5-
<PAGE>

     The Company offers laxative products specially formulated to
cleanse the G.I. tract prior to X-ray and colonoscopic examinations.
These products are sold through the same distribution network as the
Company's contrast systems.

     The Company markets a line of X-ray protection equipment featuring
Adjust-A-Weight(TM), a patented design concept which allows the wearer to
adjust the weight distribution of the protective apron to relieve
fatigue.  This product line is sold through the same distribution
network as the Company's contrast systems.

     The Company, through its wholly-owned subsidiary, Enteric
Products, Inc. ("EPI"), markets immunoassay tests for use in the
detection of Helicobacter pylori ("H. pylori").  The tests analyze a
patient's serum or whole blood sample using a patented antigen licensed
from Baylor College of Medicine.  These tests are available for both
laboratory use and for use in a physician's office.

     H. pylori infection has been identified as the leading cause of
duodenal and gastric ulcers and has also been linked to gastritis and
gastric cancer.  The World Health Organization has categorized H.
pylori as a Class 1 carcinogen, a definite cancer causing agent in
humans.  Gastric cancer is a leading cause of death in Asia, Africa and
Eastern Europe.

     The Company's agreement with Abbott Laboratories ("Abbott") for
the international marketing of its physician's office test to detect H.
pylori expires in December 1998.  The agreement covers both serum and
whole-blood versions of a simple, highly accurate four-minute test.
The tests, manufactured by SmithKline Diagnostics, Inc. ("SKD"), a
subsidiary of Beckman Coulter, Inc., are privately labeled under the
name FlexPack(TM) HP and sold by Abbott in China, India, other parts of
Asia, Eastern Europe and parts of the Middle East and Africa.  A prior
agreement, between SKD and Abbott, also terminating in December 1998,
gave Abbott the marketing rights to most of the remainder of the world
market.  The Company is currently evaluating various options with
respect to the future marketing of these products.  The Company does
not believe that the discontinuance of these agreements will have a
material adverse effect on the consolidated financial statements.  SKD,
with whom EPI co-developed the serum and whole blood tests, also
markets its own version of the product under the name FlexSure(TM) HP in
the U.S. and other selected territories.

     As a result of these agreements, EPI receives revenue (1) on the
sale of products directly to Abbott, (2) from royalties on the sale of
products to Abbott by SKD, (3) from royalties on the sale of product by
SKD to its distributors and end-users, and (4) from the sale of EPI's
patented antigen to SKD for use in both tests.  In addition, EPI
derives revenue from the sale of HM-CAP(TM), the laboratory version of
the blood serum test.  The Company markets the HM-CAP test through
distributors in the U.S. and abroad.

     Sales to Picker International, Inc., which is a distributor of the
Company's Diagnostic products, were 16% of total net sales during 1998.

     ANGIODYNAMICS PRODUCTS

     The Company, through its wholly-owned subsidiary, AngioDynamics,

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develops, manufactures and markets a variety of differentiated products
and systems for the worldwide interventional medicine marketplace,
which is the practice of medicine using both traditional and new
diagnostic procedures for therapeutic purposes.

     The Company believes that the interventional medicine market is
growing dramatically.  This is due, in large part, to the less invasive
aspects of interventional procedures, as compared to open surgical
procedures, which result in a reduction in the overall cost of medical
care while providing important patient benefits.  Interventional
procedures are often performed on an out-patient basis, thereby
requiring fewer hospital support services.  These procedures, even when
performed on an in-patient basis, generally require a shorter hospital
stay than do surgical procedures.  Interventional procedures also
typically have reduced risk and trauma, are less complex, have fewer
and less serious complications, can often be performed earlier in the
stage of a disease and frequently result in less costly and more
definitive therapy than do surgical procedures.  The Company expects
the number of interventional procedures performed to increase as these
procedures gain wider acceptance, as more physicians become trained in
less invasive medical specialties, and as these procedures become more
widely performed in community hospitals as well as in major medical
centers.  Improvements in technology should further expand the
application of interventional procedures.

     Angiography Products

     Angiography products include diagnostic catheters, fluid
management products and CO2Ject(TM), a proprietary angiographic system
that uses carbon dioxide ("CO2") instead of standard iodinated contrast
media.  These products are used during procedures known as
"angiograms", "venograms", and "cardiac catheterizations", which
provide images of the human vasculature and blood flow.

     The Company manufactures three lines of diagnostic catheters,
Memory-Vu(TM), ANGIOPTIC(TM), and Soft-Vu(TM), suitable for diagnosing the
complete human vascular system.  These catheters are made in 3, 4, 5,
and 6 French sizes, with wire braided and non-braided nylon shafts, and
are available in over 500 tip configurations and lengths, either as
standard catalogue items or made to order through the Company's
customization program.  The Company's lines of angiographic catheters
are cleared for sale in the U.S. and internationally.

     The proprietary Soft-Vu/Memory-Vu catheter technology incorporates
a soft, atraumatic tip that is attached to a more rigid shaft.  In
addition to being soft, the catheter tips are also easily visualized
under fluoroscopy.  The Company believes this soft tipped catheter
technology offers the physician a safe diagnostic catheter with less
propensity to perforate or lacerate an artery or vein.

     The Company has developed a unique catheter line called ANGIOPTIC.
The distinguishing characteristic of this product is that the entire
catheter is highly visible under fluoroscopy.  The catheter is
constructed of a proprietary triple-layer extrusion technology.

     The Company manufactures several lines of products used to
administer fluids and contain the blood and other biological wastes
produced during an interventional procedure.  These products are

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<PAGE>

designed to meet the increased concern about HIV and hepatitis.  The
AngioFill(TM) product line controls airborne blood borne pathogens by
aspirating a catheter and injecting the blood into an appropriate
receptacle.  The AngioFill systems also have fluid lines that connect
to saline and contrast media bottles.  In use, the physicians will
aspirate the catheter with a syringe and release the contents in the
AngioFill bag.  While the syringe is still connected to the AngioFill,
the physician will draw fresh saline or contrast media to flush the
catheter. The patented Pulse-Vu Needle(TM) and Sos Bloodless Entry
Needle(TM) control airborne blood borne pathogens and the spurting blood
flow normally encountered in a femoral arterial puncture.  Both needles
have a thin diaphragm to divert the pressurized column of blood into a
clear, flexible side arm tube thus preventing the blood from entering
the clinical environment.  The special diaphragm has a slit that allows
easy passage of a guidewire through the needle hub and needle lumen and
into the lumen of the artery.  The Company believes its diaphragm
technology is proprietary.  All of the Company's fluid management
products are cleared for sale in the U.S. and internationally.

     The CO2Ject is comprised of CO2 contrast, an automated injector, a
CO2 connection set, a diagnostic catheter and an angioplasty balloon
catheter.  Since a normal function of the human vasculature and blood
flow system is the transfer and expulsion of CO2 through the
respiratory system, the Company believes that CO2 provides a higher
degree of safety than iodinated contrast media, which can cause severe
allergic reactions in certain patients.  The Company also believes that
CO2 is more cost effective and provides better images than iodinated
contrast media.  Currently, the CO2Ject is being sold in Europe, South
America, Australia and Asia.  To date, there is no automated CO2 system
that has received U.S. Food and Drug Administration ("FDA") clearance
for sale in the U.S.  The Company does not anticipate receiving FDA
clearance for the CO2Ject in the near future, and there can be no
assurance that such clearance will be obtained at all.

     Therapeutic Products

     The Company's therapeutic line principally consists of
thrombolytic products, vascular access products for dialysis and liver
access products.

     The Company's proprietary thrombolytic product line is marketed
under the name Pulse*Spray(TM) and is used to dissolve blood clots in
hemodialysis access grafts, arteries and veins.  Pulse*Spray Sets
include PRO(TM) Infusion Catheters, occluding wires, check valves, and
bifurcated connecting lines.  The Pulse*Spray Set optimizes the
delivery of lytic agent (the drug that actually dissolves the clot) by
providing a controlled, forceful, uniform dispersion.  This improvement
has been clinically shown to reduce the amount of lytic agent and the
time necessary for the procedure by a factor of three.  This represents
significant cost savings for the hospital, the patient, and the
healthcare system, while reducing the complications associated with the
use of larger volumes of lytic agent.  The Pulse*Spray Set is cleared
for sale in the U.S. and internationally.

     The Pulse*Spray Injector is designed to be used in conjunction
with AngioDynamics' other therapeutic products.  This automated
injector replaces hand pressure as an injection mechanism and improves
the consistency and efficiency of the delivery of lytic agents through

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various Pulse*Spray Sets and PRO Infusion Catheters.  The Pulse*Spray
Injector will only accept the Company's manufactured single use
components and catheters.  It allows the user to deliver a wide range
of infusion volumes and times and utilizes state-of-the-art computer
technology with a touch screen program to store up to 20 customer-
specified programs.

     During 1998, the FDA granted AngioDynamics a 510(k) clearance to
market the Pulse*Spray Injector in the U.S.  The Company believes that
the Pulse*Spray Injector may provide the first viable treatment for
dissolving deep vein clots (DVT's) in a wide patient population.  Early
clinical experience with the Pulse*Spray Injector indicates a
significant reduction in the amount of thrombolytic drugs and time
required to resolve thrombosed deep veins in the legs.  Further
clinical evidence is needed to confirm these initial results.

     The Company's vascular access products, marketed under the Schon
trade name, are primarily used by patients requiring blood dialysis.
These vascular access catheters are classified as long-term or acute.
A long-term catheter is used in the event the patient is waiting for a
permanent dialysis graft to heal after a surgical placement or repair.
Acute catheters are placed in patients with a temporary interruption of
renal function due to serious injury or trauma.  The Company believes
that vascular access procedures in general and dialysis access
procedures specifically, are growing rapidly.

     The Company's liver access products include the biliary AngioStent
and a transjugular intrahepatic portosystemic shunt ("TIPS") access
set.

     Subsequent to fiscal year end 1998, the Company filed a 510(k)
submission with the FDA to market the AngioStent for biliary stricture
application in the U.S.  Biliary stricture, a condition common among
hepatic and pancreatic cancer patients, is a narrowing of the bile duct
as a result of tumor ingrowth.  The Company believes the biliary
AngioStent has certain advantages versus the conventional treatment
since it will resist clogging due to its wide diameter and will resist
tumor ingrowth because of its strong radial pressure.

     The Company's TIPS access set is designed to probe the liver with
a small 21 gauge needle and utilizes carbon dioxide as a contrast agent
to visualize important liver structures such as the hepatic artery and
bile ducts.  Cirrhosis of the liver often causes bleeding of the
esophageal varices.  As an alternative to traditional surgical methods,
a TIPS (shunt) is placed between the portal vein and hepatic vein in
the liver to reduce pressure and thus relieve the bleeding.

     The Company acted as the U.S. sales agent for Navarre Biomedical,
Ltd, a manufacturer of percutaneous abscess drainage catheters.
Percutaneous abscess drainage involves resolution of pus pockets,
pleural effusions and other fluids by inserting the catheter directly
into the fluid pocket under fluoroscopic, CT or ultrasound guidance.
Sales of this product line were approximately $1.2 million in 1998.
This distribution agreement was terminated subsequent to fiscal year
end.



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     Stent/Angioplasty Products

     Stents are used to hold open passageways in the body that may have
closed or become obstructed as a result of aging, disease, or trauma.
Stents are increasingly being used as an alternative to or adjunct to
surgical and minimally invasive procedures and drug therapies, which
reduce procedure time, patient trauma, hospitalization and recovery
time.  The Company believes that the coronary AngioStent provides a
competitive advantage over competing stent products and alternative
therapies.

     The Company believes AngioStent incorporates a number of unique
and proprietary design features that allow the effective treatment of a
variety of lesion and vessel types.  The AngioStent is constructed
from a single strand of platinum alloy wire that is precision formed
into a spiraling sinusoidal configuration.  This configuration has the
wire turn back on itself and attach back at its beginning, thereby
forming a longitudinal wire that imparts added strength and stability.
The Company believes that its patented stent design provides more
consistent vessel support and radial force than other stent designs,
as well as more visibility, flexibility, and easier delivery than
competitive stents.  The Company believes that its use of platinum
imparts better hemocompatibility and long-term biocompatibility than
stainless steel stent designs.  The AngioStent is available in a
variety of diameters and lengths and is provided pre-mounted on both
the over-the-wire and rapid exchange delivery systems.  Both of these
delivery systems offer advanced features, such as a high pressure
balloon and one-step-placement with no necessity for pre-dilation of
the target lesion.  The AngioStent has been utilized in a variety of
coronary and peripheral applications, including vessels in which other
stent procedures have failed, as well as in the treatment of difficult
lesions in curved or tortuous vessels.  The Company believes the
technical features of its proprietary AngioStent systems provide the
Company with a number of competitive advantages.  The Company intends
to use this base of stent technology to develop stents for the
peripheral vascular market.

     The AngioStent currently is marketed internationally for
peripheral vascular and coronary applications.  The AngioStent for
peripheral vascular and coronary applications has not yet been cleared
for sale in the U.S.  The Company intends to submit a premarket
approval ("PMA") application to obtain marketing clearance from the FDA
for peripheral vascular applications, but not for coronary use.

     The Company also develops and manufacturers percutaneous
transluminal coronary angioplasty ("PTCA") balloon catheters.  A PTCA
balloon catheter is used to inflate a narrowing in the arteries of the
heart, either by expanding a stent or on a stand-alone basis during
balloon angioplasty procedures.  The PTCA products include the Racer
Pico, Racer Select, Pico Runner and Pico ST II balloon catheters, each
of which is approved for sale internationally (with the Pico Runner and
Pico ST II cleared for sale in the U.S.).  The Company intends to use
the base of balloon catheter technology to develop PTA balloon
catheters for the peripheral vascular market.

     O.E.M. Manufacturing

     During 1998 the Company announced a decision to focus its

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<PAGE>

marketing efforts in the interventional radiology market; also, that it
needs to find a strategic partner, with an existing cardiovascular
sales and marketing franchise, to leverage its stent and angioplasty
technology in the cardiology market.  The Company has two ISO 9001
certified facilities with available manufacturing capacity and is
seeking partnerships, joint ventures and O.E.M. arrangements to
manufacture PTCA balloon catheters, stent delivery systems and similar
products. The Company also sells certain angiographic products on a
bulk, non-sterile basis.

     MARKETING

     The Company believes that the success of its barium sulfate
products is primarily due to its ability to create contrast systems
with specific, sophisticated barium formulations for varying radiologic
needs.  E-Z-EM continues to develop new barium sulfate products,
including products for CT-scanning and MRI procedures.

     E-Z-EM's contrast systems, laxatives, syringes, X-ray protection
equipment and diagnostic radiology devices, such as biopsy needles and
trays, are marketed to radiologists and hospitals in the U.S. through
about 230 distributors, supported by 31 E-Z-EM sales people, many of
whom have had technical training as X-ray technicians.  The Company
also advertises in medical journals and displays at most national and
international radiology conventions.

     Outside the U.S., the Company's contrast systems are also marketed
through 119 distributors, including wholly-owned subsidiaries in
Canada, the United Kingdom, Japan and Holland.  Significant sales are
made in Canada, the United Kingdom, Japan, Holland, Italy, France,
Austria, Sweden and Belgium.  Foreign distributors are generally
granted exclusive distribution rights and hold governmental product
registrations in their names, although new registrations are currently
being filed in the Company's name.

     The Company's AngioDynamics products are marketed to
interventional radiologists, cardiologists, vascular surgeons and
nephrologists.  Domestic sales are supported by 19 direct sales
employees, while the international marketing effort is conducted
through 56 distributors, including 3 wholly-owned subsidiaries.
Foreign distributors are generally granted exclusive distribution
rights on a country-by-country basis.

     COMPETITION

     Based upon sales, E-Z-EM contrast systems are the most widely used
diagnostic imaging products of their kind in the U.S., Canada and
certain European countries.  The Company faces competition domestically
from Lafayette Pharmaceuticals, Incorporated, as well as from small
U.S. competitors, and it also faces competition outside of the U.S.
The Company competes primarily on the basis of product quality,
customer service, the availability of a full line of barium sulfate
formulations tailored to user needs, and price.

     Radiologic procedures for which the Company supplies products
complement, as well as compete with, endoscopic procedures such as
colonoscopy and endoscopy.  Such examinations involve visual inspection
of the G.I. tract through the use of a flexible fiber optic instrument

                                  -11-
<PAGE>

inserted into the patient by a gastroenterologist.  The use of
gastroenterology procedures has been growing in both upper and lower
G.I. examinations as patients have been increasingly referred to
gastroenterologists rather than radiologists.  Also, the availability
of drugs which successfully treat ulcers and other gastrointestinal
disorders has tended to reduce the need for upper G.I. tract
examinations.  In January 1998, Medicare began reimbursing for
colorectal cancer screening utilizing G.I. examinations, as well as
other procedures.

     The major non-contrast systems market that the Company competes in
is the medical device radiology market, which is highly competitive.
No single company, domestic or foreign, competes with the Company
across all of its non-contrast system product lines.  In
electromechanical injectors and syringes, the Company's main
competitors are Schering AG and Mallinckrodt, Inc.  In needles and
trays, the Company competes with C.R. Bard, Inc., Baxter Healthcare
Corporation, Sherwood Medical Co. and various other competitors.  The
Company also encounters competition in the marketing of its other non-
contrast systems products.

     The Company competes in the AngioDynamics products segment on the
basis of product quality, product innovation, sales, marketing and
service effectiveness, and price.  There are many large companies, with
significantly greater financial, manufacturing, marketing, distribution
and technical resources than the Company, focusing on these markets.
Those Company products that already have FDA clearance and those
Company products that in the future receive FDA clearance will have to
compete vigorously for market acceptance and market share.

     Arterial Vascular Engineering, Inc., Johnson & Johnson
Interventional System, Co., Schneider, Inc. (a part of Pfizer, Inc.),
Boston Scientific Corporation, C.R. Bard, Inc., Cook, Inc., Cordis
Corporation, Guidant Corporation, Medtronic, Inc., Biotronik GmbH,
Progressive Angioplasty Systems, American Biomed, Inc. and Global
Therapeutics, among others, currently compete against the Company in
the development, production and marketing of stents and stent
technology.

     The medical indications that can be treated by stents can also be
treated by surgery, drugs, or other medical devices, many of which are
widely accepted in the medical community.  The ability to use patents
and other proprietary rights to prevent sales by competitors is an
important tool in the medical devices industry.

     Within the contrast media market, the Company's CO2Ject system
competes with a product offered by Daum GmbH.  The Company also
competes with companies marketing iodinated contrast agents.  These
companies include Nycomed Inc., Bracco s.p.a., Schering AG and
Mallinckrodt, Inc.

     In the market for diagnostic angiography catheters, the Company's
major competitors are Boston Scientific Corporation, Cook, Inc. and
Mallinckrodt, Inc.

     The competitive situation in the market for thrombolytic
therapeutic products is complex.  The first level of competition is the
medical profession, where each physician can decide if an artery or

                                  -12-
<PAGE>

graft will be cleared surgically or by thrombolysis.  If thrombolysis
is used, the second level of competition is for the specific type of
catheter or wire that will be used.  The primary competitors in this
market are MediTech, Micro Therapeutics, Inc. and Cook, Inc.

     The Company believes that it is perceived as a market leader in
the market for blood containment products, where its primary
competition comes from Arrow International and Becton-Dickinson.  The
market for fluid management systems is extremely competitive, with the
Company's products being similar to products from Schneider, Inc. (a
part of Pfizer, Inc.), Merit, Burron Medical, DeRoyal, Biocore,
Advanced Medical Design, Medex and Argon. These products are non-
patient contact and, therefore, the barriers to entry, such as
regulatory clearance, potential liability, and the need for technical
sophistication, are not significant.

     RESEARCH AND DEVELOPMENT

     In addition to its technical staff, consisting of a
Medical/Technical Director and 41 employees, the Company has consulting
arrangements with various physicians who assist through their
independent research and product development.  Research and development
expenditures totaled $5,662,000, or 6% of net sales, in 1998, as
compared to $6,881,000, or 7% of net sales, in 1997 and $5,323,000, or
6% of net sales, in 1996, reflecting the Company's commitment to
expansion of its product lines through research and development.

     RAW MATERIALS AND SUPPLIES

     Most of the barium sulfate for contrast systems is supplied by a
number of European and U.S. manufacturers, with a minor portion being
supplied by the Company's wholly-owned Canadian subsidiary, E-Z-EM
Canada Inc. ("E-Z-EM Canada"), which operates a barium sulfate mine and
processing facility in Nova Scotia and whose reserves are anticipated
to last a minimum of five years at current usage rates.  The Company
believes that these sources should be adequate for its foreseeable
needs.

     The Company has generally been able to obtain adequate supplies of
all components for its AngioDynamics business in a timely manner from
existing sources.  However, the inability to develop alternative
sources, if required, or a reduction or interruption in supply, or a
significant increase in the price of components, could adversely affect
operations.

     PATENTS AND TRADEMARKS

     Although several products and processes are patented and the
Company considers its trademarks to be a valuable marketing tool, the
Company does not consider any single patent, group of patents, or
trademarks to be materially important to its Diagnostic business
segment.  E-Z-EM and AngioDynamics are examples of the Company's
registered trademarks in the U.S.

     The Company believes that success in the AngioDynamics products
segment is dependent, to a large extent, on patent protection and the
proprietary nature of its technology.  The Company intends to file and
prosecute patent applications for technology for which it believes

                                  -13-
<PAGE>

patent protection is effective and advisable.  The Company believes
that issued patents covering Pulse*Spray and AngioStent are significant
to its AngioDynamics business.

     Because patent applications are secret until patents are issued in
the U.S. or corresponding applications are published in foreign
countries, and because publication of discoveries in the scientific or
patent literature often lags behind actual discoveries, the Company
cannot be certain that it was the first to make the inventions covered
by each of its pending patent applications, or that it was the first to
file patent applications for such inventions.  The Company also relies
on trade secret protection and confidentiality agreements for certain
unpatented aspects of its proprietary technology.

     REGULATION

     The Company's products are registered with the FDA and with
similar regulatory agencies in foreign countries where they are sold.
The Company believes it is in compliance in all material respects with
applicable regulations of these agencies.

     Certain of the Company's products are subject to FDA regulation as
medical devices and certain other products, such as various contrast
systems products and CO2Ject, are regulated as pharmaceuticals.
Outside of the U.S., the regulatory process and categorization of
products vary on a country-by-country basis.

     The Company's products are covered by Medicare, Medicaid and
private healthcare insurers, subject to patient eligibility.  Changes
in the reimbursement policies and procedures of such insurers may
affect the frequency with which such procedures are performed.

     The Company operates several facilities within a broad industrial
area located in Nassau County, New York, which has been designated by
New York State as a Superfund site.  This industrial area has been
listed as an inactive hazardous waste site, due to ground water
investigations conducted on Long Island during the 1980's.  Due to the
broad area of the designated site, the potential number of responsible
parties, and the lack of information concerning the degree of
contamination and potential clean-up costs, it is not possible to
estimate what, if any, liability exists with respect to the Company.
Further, it has not been alleged that the Company contributed to the
contamination, and it is the Company's belief that it has not done so.

     EMPLOYEES

     The Company employs 923 persons, 229 of whom are covered by
various collective bargaining agreements.  Collective bargaining
agreements covering 123 and 102 employees expire in December 1998 and
December 1999, respectively.  The Company considers employee relations
to be satisfactory.

(d)  FINANCIAL INFORMATION REGARDING FOREIGN AND DOMESTIC OPERATIONS
     AND EXPORT SALES

     The Company derived about 36% of its sales from customers outside
the U.S. during 1998.  Operating profit margins on export sales are
somewhat lower than domestic sales margins.  The Company's domestic

                                  -14-
<PAGE>

operations bill third party export sales in U.S. dollars and,
therefore, do not incur foreign currency transaction gains or losses.
Third party sales to Canadian customers, which are made by E-Z-EM
Canada, are billed in local currency.  Third party sales to Japanese
customers, which are made by the Company's Japanese subsidiary, are
also billed in local currency.

     The Company employs 334 persons involved in the developing,
manufacturing and marketing of products internationally.  The Company's
product lines are marketed through approximately 152 foreign
distributors to 88 countries outside of the U.S.

     The net sales and operating profit (loss) of each geographic area
and the identifiable assets attributable to each geographic area as
well as export sales from domestic operations are set forth in Note O
to the Consolidated Financial Statements included herein.


Item 2.  PROPERTIES

     The Company's principal manufacturing facilities and executive
offices are located in Westbury, New York.  They consist of four
buildings, one of which is owned by the Company, containing an
aggregate of 194,800 square feet used for manufacturing, warehousing
and administration.  One of the Westbury facilities is leased to the
Company by various lessors, including certain related parties.  Such
facility is currently being leased on a month-to-month basis.  See
"Certain Relationships and Related Transactions".  AngioDynamics
occupies manufacturing and warehousing facilities located in
Queensbury, New York consisting of two buildings, one of which is owned
by the Company, containing an aggregate of 29,312 square feet.
AngioDynamics Ltd. owns a 20,000 square-foot manufacturing and
warehousing facility located in Enniscorthy, Ireland.  E-Z-EM Caribe
owns a 38,600 square-foot plant in San Lorenzo, Puerto Rico which
fabricates enema tips and heat-sealed products.  E-Z-EM Canada
leases a 29,120 square-foot building in Debert, Nova Scotia and both
owns and leases land encompassing its barium sulfate mining operation.
E-Z-EM Canada also owns a 64,050 square-foot manufacturing and
warehousing facility located in Montreal, Canada.


Item 3.  LEGAL PROCEEDINGS

     Previously, the Company was named as a defendant in the following
product liability action:

     PATRICIA M. HELLER AND WAYNE HELLER, PLAINTIFFS VS. E-Z-EM, INC.,
     A CORPORATION, DEFENDANT, pending in the Court of Common Pleas,
     Montgomery County, Pennsylvania, filed on February 25, 1997.

     This suit claimed damages based upon alleged injuries resulting
from the use of one of the Company's products.  During December 1997,
the Company settled such action for an amount under its insurance limit
and the amount contributed by the Company was not material to its
consolidated financial statements.

     During April 1998, the Company settled a lawsuit brought upon by
Olympia Holding Corporation p/k/a P-I-E Nationwide, Inc. for alleged

                                  -15-
<PAGE>

undercharges for freight carriage.  Such lawsuit was settled for an
amount under the Company's insurance limit and the amount contributed
by the Company was not material to its consolidated financial
statements.

     The Company is presently involved in various other claims, legal
actions and complaints arising in the ordinary course of business.  The
Company believes such matters are without merit, or involve such
amounts that unfavorable disposition would not have a material adverse
effect on the Company's financial position.


Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.


                                  -16-
<PAGE>

                                PART II


Item 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
         MATTERS

     E-Z-EM, Inc. Class A and Class B Common Stock is traded on the
American Stock Exchange ("AMEX") under the symbols "EZM.A" and "EZM.B",
respectively.  The following table sets forth, for the periods
indicated, the high and low sale prices for the Class A and Class B
Common Stock as reported by the AMEX.

                                       Class A          Class B
                                   ---------------  ---------------
                                     High    Low      High    Low
                                   ------- -------  ------- -------

     Fifty-two weeks ended May 30, 1998
     ----------------------------------

     First Quarter................  $9.13   $7.50    $7.88   $6.63
     Second Quarter...............   8.63    7.13     7.50    5.88
     Third Quarter................   7.88    6.88     7.38    6.25
     Fourth Quarter...............   9.75    6.75     9.00    5.88

     Fifty-two weeks ended May 31, 1997
     ----------------------------------

     First Quarter................ $14.13  $10.38   $13.25  $ 9.75
     Second Quarter...............  15.00   10.50    15.25   10.63
     Third Quarter................  13.00   11.00    12.75   11.00
     Fourth Quarter...............  12.13    8.19    11.50    7.63

     As of August 3, 1998 there were approximately 237 and 375 record
holders of the Company's Class A and Class B Common Stock,
respectively.

     The Company's current policy has been to issue stock dividends.
During the third quarter of fiscal years 1996 and 1998 and the fourth
quarter of fiscal year 1997, the Company issued 3% stock dividends.
Future dividends are subject to the Board of Directors' review of
operations and financial and other conditions then prevailing.





















                                  -17-
<PAGE>

Item 6.  SELECTED FINANCIAL DATA



                             Fifty-two weeks ended   Fifty-three  Fifty-two
                           ------------------------- weeks ended weeks ended
                           May 30,  May 31,  June 1,   June 3,     May 28,
                            1998#    1997     1996      1995*       1994*
                           ------   ------   ------    ------      ------
                                (in thousands, except per share data)

Income statement data:
  Net sales..............$102,884  $97,324  $91,932   $88,526     $85,645
  Gross profit...........  37,433   36,570   36,414    36,681      33,617
  Operating profit (loss)  (5,351)  (4,911)     957     2,837       1,200
  Earnings (loss) from
    continuing operations
    before income taxes..  (5,534)  (4,530)   1,940     3,559       1,528
  Earnings (loss) from
    continuing operations  (5,967)  (3,208)   1,697     2,473         379
  Net earnings (loss)....  (5,967)  (3,208)  21,008     1,630         277
  Earnings (loss) from
    continuing operations
    per common share
      Basic and diluted
        (1)..............    (.60)    (.33)     .17       .26         .04
  Earnings (loss) per
    common share
      Basic (1)..........    (.60)    (.33)    2.16       .17         .03
      Diluted (1)........    (.60)    (.33)    2.04       .17         .03
  Weighted average common
    shares
      Basic (1)..........   9,952    9,871    9,712     9,634       9,633
      Diluted (1)........   9,952    9,871   10,315     9,640       9,633

                           May 30,  May 31,  June 1,   June 3,     May 28,
                            1998     1997     1996      1995        1994
                           ------   ------   ------    ------      ------
                                         (in thousands)

Balance sheet data:
  Working capital........ $41,597  $43,115  $53,508   $33,254     $33,088
  Cash, certificates of
    deposit and short-
    term debt and equity
    securities...........   8,129   15,475   23,610     4,447       7,336
  Total assets...........  90,706  100,720   96,037    76,095      71,531
  Long-term debt, less
    current maturities...     606      842      680     1,114         586
  Stockholders' equity...  71,223   77,244   80,603    57,890      54,269
_______________

 #  Includes the impairment charge of $4,121,000 described in Note B to the
    Consolidated Financial Statements included herein.

 *  Reclassified to reflect the discontinued operation described in Note C
    to the Consolidated Financial Statements included herein.

(1) Retroactively restated to reflect the total shares issued after the 3%
    stock dividends described in Note M to the Consolidated Financial
    Statements included herein.

                                  -18-
<PAGE>

Item 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
         AND RESULTS OF OPERATIONS

     The Company's fiscal years ended May 30, 1998, May 31, 1997 and
June 1, 1996 represent fifty-two weeks.  The following discussion and
analysis is based on the results of continuing operations of the
Company.

RESULTS OF OPERATIONS

     SEGMENT OVERVIEW

     The Company operates in two industry segments:  Diagnostic
products and AngioDynamics products.  The Diagnostic products industry
segment encompasses both contrast systems, consisting of barium sulfate
formulations and related medical devices used in X-ray, CT-scanning,
ultrasound and MRI imaging examinations, and non-contrast systems,
including diagnostic radiology devices, custom contract
pharmaceuticals, gastrointestinal cleansing laxatives, X-ray protection
equipment, and immunoassay tests.  Contrast systems, which constitute
the Company's core business and the majority of the Diagnostic products
segment, accounted for 57% of net sales in 1998, as compared to 61% in
1997 and 68% in 1996.  Non-contrast system sales accounted for 24% of
net sales in 1998, as compared to 21% in 1997 and 20% in 1996.  The
AngioDynamics products industry segment, which includes angiography
products, therapeutic products and stent/angioplasty products used in
the interventional medicine marketplace, accounted for 19% of net sales
in 1998, as compared to 18% in 1997 and 12% in 1996.

                              Diagnostic  AngioDynamics  Eliminations  Total
                              ----------  -------------  ------------  -----
                                              (in thousands)

Fifty-two weeks ended May 30, 1998
----------------------------------

  Unaffiliated customer sales  $83,475       $19,409           -     $102,884
  Intersegment sales                91           483        ($574)        -
  Gross profit (loss)           30,220         7,263          (50)     37,433
  Operating profit (loss)        1,988        (7,317)         (22)     (5,351)

Fifty-two weeks ended May 31, 1997
----------------------------------

  Unaffiliated customer sales  $79,588       $17,736           -      $97,324
  Intersegment sales             1,250           926      ($2,176)        -
  Gross profit (loss)           28,794         7,783           (7)     36,570
  Operating loss                (1,088)       (3,816)          (7)     (4,911)

Fifty-two weeks ended June 1, 1996
----------------------------------

  Unaffiliated customer sales  $80,936       $10,996           -      $91,932
  Intersegment sales               -             700        ($700)        -
  Gross profit (loss)           30,872         5,561          (19)     36,414
  Operating profit (loss)        2,509        (1,536)         (16)        957

     DIAGNOSTIC PRODUCTS

     Diagnostic segment operating results for 1998 improved by
$3,076,000 due to a 5% sales increase, as well as reduced operating
expenses of $1,650,000.  Price increases virtually offset the effect of

                                  -19-
<PAGE>

increased discounts to group purchasing organizations.  Gross profit
expressed as a percentage of net sales was 36% during both 1998 and
1997, as the effects of increased discounts to group purchasing
organizations were offset by reduced unabsorbed overhead costs
associated with the manufacturing site relocation.

     Diagnostic segment operating results for 1997 declined by
$3,597,000 due to lower gross profit and increased operating expenses
of $1,523,000.  The lower gross profit resulted from increased
inventory reserves of $676,000, approximately $558,000 of increased
unabsorbed overhead costs associated with the relocation of a portion
of the Company's contrast systems manufacturing operations, and sales
discounts to group purchasing organizations.  Increased regulatory
costs associated with product validations of $857,000 and severance
costs of $365,000 contributed to the increased operating expenses in
1997.

     ANGIODYNAMICS PRODUCTS

     AngioDynamics segment operating results for 1998, which declined
by $3,501,000, were adversely affected by a non-cash accounting charge
of $4,121,000, relating to an impairment of certain long-lived assets
used in the cardiovascular market.  The Company determined that the
revenue potential of this technology, as it relates to the
cardiovascular market, was impaired due to increased competition and
price erosion for coronary stents and angioplasty products and the
Company's strategic decision to commercially exploit this technology in
the interventional radiology market.  The Company is seeking a
strategic business partner with an existing cardiovascular sales and
marketing franchise in order to be successful in the cardiovascular
market, although there can be no assurances that such a partner can be
found.  The charge had no impact on the Company's cash flow or its
ability to generate cash flow in the future.  As a result of the
impairment charge, amortization expense related to these assets will
decrease by approximately $250,000 per year.

     Discounting the effect of the impairment charge, AngioDynamics
operating results improved by $620,000 due to reduced operating
expenses, partially offset by lower gross profit.  Domestic sales
improved by $3,154,000, or 27%, due to continued market penetration,
while international sales decreased $1,480,000, or 24%, due to a
decline in sales of the coronary AngioStent(TM).  Overall, AngioDynamics
sales increased 9% during 1998.  Gross profit expressed as a percentage
of net sales declined to 37% during 1998 versus 42% during 1997 due
primarily to price erosion in the coronary stent marketplace,
underutilized capacity at the Irish manufacturing facility, and
increased inventory reserves of $344,000.  Operating expenses before
the impairment charge decreased $1,140,000 due, in part, to the
write-off of expenses relating to the proposed initial public offering
of AngioDynamics in 1997.

     AngioDynamics segment operating results for 1997, which declined
by $2,280,000, were adversely affected by increased operating expenses
of $4,502,000, partially offset by sales growth of 61%, as compared to
1996.  The sales growth was due to continued international and domestic
market penetration.  The coronary AngioStent was introduced
internationally by the Company in the third quarter of 1996 and was the
major contributor to the international sales growth in 1997.  Increased

                                  -20-
<PAGE>

operating expenses can be attributed to expenses supporting the 61%
sales increase in 1997 and increased administrative expenses.  Gross
profit expressed as a percentage of net sales declined to 42% in 1997,
as compared to 48% in 1996, due primarily to start-up costs relating to
AngioDynamics' entry into the coronary stent marketplace and increased
inventory reserves of $180,000.

     DISCONTINUED SEGMENT

     During 1996, the Company discontinued the operation of its
surgical products industry segment when it sold Surgical Dynamics Inc.
("SDI"), its 51%-owned subsidiary, to United States Surgical
Corporation.  As a result of this sale, the Company recognized a gain,
pretax of approximately $25,539,000, after-tax of approximately
$19,520,000, or $2.01 per common share on a basic EPS basis.  The
surgical products industry segment has been reported as a discontinued
operation and, accordingly, the gain from the sale of SDI and the
Company's proportionate share of losses from operations of SDI have
been classified as a discontinued operation in the consolidated
statements of operations.  The surgical products industry segment
included the Nucleotome(TM) device, the Ray Threaded Fusion Cage(TM) and
other surgical devices and accessories used in spinal surgery.

     The net sales and operating profit (loss) of each industry segment
and the identifiable assets, depreciation and amortization, and capital
expenditures attributable to each industry segment are set forth in
Note O to the Consolidated Financial Statements included herein.

     CONSOLIDATED RESULTS OF OPERATIONS

     The Company reported a net loss of $5,967,000, or ($.60) per
common share on a basic and diluted basis for 1998, as compared to a
net loss of $3,208,000, or ($.33) per common share on a basic and
diluted basis, for 1997, and net earnings of $21,008,000, or $2.16 and
$2.04 per common share on a basic and diluted basis, respectively, for
1996.  Results for 1998 included the AngioDynamics impairment charge,
with no associated tax benefit, of $4,121,000, or $.41 per common
share.  The fact that the Company did not record a tax benefit for
financial reporting purposes, associated with the impairment charge,
does not affect its ability to record the deduction for tax purposes at
some future date.  Results for 1996 included an after-tax gain on the
sale of SDI of $19,520,000, or $2.01 and $1.89 per common share on a
basic and diluted basis, respectively.

     Loss from continuing operations for 1998 was $5,967,000, or ($.60)
per common share on both a basic and diluted basis, as compared to a
loss from continuing operations of $3,208,000, or ($.33) per common
share on both a basic and diluted basis, in 1997 and earnings from
continuing operations of $1,697,000, or $.17 per common share on both a
basic and diluted basis, in 1996.

     Results from continuing operations for 1998 were adversely
affected by the AngioDynamics impairment charge of $4,121,000, or $.41
per share, and lower AngioDynamics gross profit.  Results were
positively affected by increased sales coupled with reduced operating
expenses, before impairment charge, in both industry segments.



                                  -21-
<PAGE>

     Results from continuing operations for 1997 were adversely
impacted by increased operating expenses in both industry segments, as
well as reduced gross profit in the Diagnostic segment.  In the
AngioDynamics segment, increased operating expenses can be attributed
to expenses supporting the 61% sales increase in 1997 and increased
administrative expenses.  In the Diagnostic segment, increased
regulatory costs associated with product validations of $857,000 and
severance costs of $365,000 contributed to the increased operating
expenses in 1997.  The lower Diagnostic gross profit resulted from
increased inventory reserves of $676,000, increased unabsorbed overhead
costs associated with the manufacturing site relocation of
approximately $558,000, and sales discounts to group purchasing
organizations.

     Net sales increased 6%, or $5,560,000, to $102,884,000 in 1998,
and increased 6%, or $5,392,000, to $97,324,000 in 1997.  Net sales in
1998 were favorably affected by increased sales of non-contrast systems
of $4,192,000, including $2,648,000 relating to custom contracts, and
AngioDynamics products of $1,673,000.  Price increases, net of
discounts to group purchasing organizations, had little effect on net
sales in 1998.  Net sales in 1997 were favorably affected by increased
sales of AngioDynamics products of $6,740,000 and non-contrast systems
of $1,923,000.  The AngioDynamics sales growth was due to international
market penetration, due primarily to the introduction of the coronary
AngioStent, and domestic market penetration.  Net sales in 1997 were
adversely affected by a 6% decline in the Company's sales of barium
contrast systems.  Price increases had little effect on net sales in
1997.

     Net sales in international markets, including direct exports from
the U.S., decreased 3%, or $975,000, to $36,739,000 in 1998 and
increased 12%, or $3,932,000, to $37,714,000 in 1997.  The 1998
decline was due to decreased sales of contrast systems of $1,691,000
and AngioDynamics products of $1,480,000, partially offset by increased
sales of non-contrast systems of $2,196,000.  The decline in sales of
AngioDynamics products is due to lower stent sales.  The increase in
sales of non-contrast systems is attributable to increased sales of
custom contracts.  The 1997 increase was due to increased sales of
AngioDynamics products of $3,679,000 and non-contrast systems of
$1,825,000, partially offset by decreased sales of contrast systems of
$1,572,000.

     Gross profit expressed as a percentage of net sales was 36% in
1998, as compared to 38% in 1997 and 40% in 1996.  The decline in gross
profit, expressed as a percentage of net sales, in 1998 was due
primarily to reduced AngioDynamics gross profit, resulting from price
erosion in the coronary stent marketplace, underutilized capacity at
the Irish manufacturing facility, and increased inventory reserves of
$344,000.  In the Diagnostic segment, the effects of increased
discounts to group purchasing organizations, were offset by reduced
unabsorbed overhead costs associated with the manufacturing site
relocation.  Gross profit in 1997 was negatively impacted by
approximately $3,037,000 of unabsorbed overhead costs associated with
the manufacturing site relocation, increased inventory reserves of
$856,000, start-up costs relating to AngioDynamics' entry into the
coronary stent marketplace, and sales discounts to group purchasing
organizations.


                                  -22-
<PAGE>

     Selling and administrative ("S&A") expenses were $33,001,000 in
1998, $34,600,000 in 1997 and $30,134,000 in 1996.  The decrease in
1998 versus 1997 of $1,599,000, or 5%, was due to decreased Diagnostic
S&A expenses of $1,053,000 and decreased AngioDynamics S&A expenses of
$546,000, which resulted, in part, from the write-off of expenses
relating to the proposed initial public offering of AngioDynamics in
1997.  The increase in 1997 versus 1996 of $4,466,000, or 15%, was due
to increased AngioDynamics S&A expenses of $3,776,000 and increased
Diagnostic S&A expenses of $690,000.  Increased AngioDynamics S&A
expenses can be attributed to expenses supporting the 61% sales
increase in 1997 and increased administrative expenses, partially
resulting from the write-off of expenses relating to the proposed
initial public offering of AngioDynamics, the start-up of a facility in
Ireland and the acquisition of Leocor, Inc.  Increased Diagnostic S&A
expenses resulted, in part, from severance costs of $365,000 in 1997.

     Research and development ("R&D") expenditures in 1998 totalled
$5,662,000, or 6% of net sales, as compared to $6,881,000, or 7% of net
sales, in 1997 and $5,323,000, or 6% of net sales, in 1996.  The
decline in 1998 versus 1997 of $1,219,000 was due primarily to
decreases in regulatory expenses associated with product validations of
$826,000 and AngioDynamics project spending of $593,000, partially
offset by increased contrast system spending of $415,000.  The increase
in 1997 versus 1996 of $1,558,000 was due primarily to increased
regulatory costs associated with product validations of $857,000 and
increased spending of $691,000 relating to AngioDynamics projects.  Of
the R&D expenditures in 1998, approximately 42% relate to contrast
systems, 32% to AngioDynamics projects, 11% to general regulatory
costs, 3% to immunological projects, and 12% to other projects.  R&D
expenditures are expected to continue at approximately current levels.
In addition to its in-house technical staff, the Company is presently
sponsoring various independent R&D projects and is committed to
continued expansion of its product lines through R&D.

     Other income, net of other expenses, totalled $183,000 of expense
in 1998, $381,000 of income in 1997 and $983,000 of income in 1996.
The change in 1998 versus 1997 was primarily due to increased interest
expense of $177,000 and decreased interest income of $138,000,
resulting from bank financing for the AngioDynamics operations, coupled
with the recording of the Company's approximate 23% share in the losses
of ITI Medical Technologies, Inc. of $219,000.  The decline in other
income in 1997 versus 1996 was primarily due to increased interest
expense of $253,000, resulting from AngioDynamics bank financing, and
increased foreign currency exchange losses of $161,000.

     Note H to the Consolidated Financial Statements included herein
details the major elements affecting income taxes for 1998, 1997 and
1996.  In 1998, the Company reported an income tax provision of
$433,000 against losses from continuing operations before income taxes
of $5,534,000 due primarily to the fact that the Company did not
provide for the tax benefit on losses incurred in certain
jurisdictions, since it is more likely than not that such benefits
will not be realized.  In 1997, the Company's effective tax benefit
rate of 29% differed from the Federal statutory tax rate of 34% due
primarily to losses incurred in a foreign jurisdiction subject to lower
tax rates and to the fact that the Company did not provide for the tax
benefit on losses incurred in certain foreign jurisdictions, since, at
that time, it was more likely than not that such benefits would not be

                                  -23-
<PAGE>

realized, partially offset by earnings of the Puerto Rican subsidiary,
which are subject to favorable U.S. tax treatment.  In 1996, the
Company's low effective tax rate of 13% differed from the Federal
statutory tax rate of 35% due primarily to earnings of the Puerto Rican
subsidiary, which are subject to favorable U.S. tax treatment and tax-
exempt interest income.

LIQUIDITY AND CAPITAL RESOURCES

     During 1998, debt repayments, capital expenditures and investment
in affiliate were funded primarily by cash reserves.  During 1997, the
purchase of Leocor, capital expenditures and increased inventory levels
were funded primarily by cash reserves and proceeds from the issuance
of bank debt.  During 1996, capital expenditures and increased
inventory levels were funded primarily by cash reserves.  As a result
of the sale of SDI in November 1995, the Company increased its cash
reserves by approximately $21,000,000.  The proceeds from the sale of
SDI were invested in debt securities.  In the past, the Company's
policy has been to fund capital requirements without incurring
significant debt.  At May 30, 1998, debt (notes payable, current
maturities of long-term debt and long-term debt) was $3,934,000 as
compared to $8,388,000 at May 31, 1997.  The Company has available
$8,858,000 under four bank lines of credit of which $1,961,000 was
outstanding at May 30, 1998.

     The Company's current policy is to issue stock dividends.  During
the third quarter of fiscal years 1996 and 1998 and the fourth quarter
of fiscal year 1997, the Company issued 3% stock dividends.

     Presently, the Company is continuing to look for both new and
complementary lines of business for expansion in order to ensure its
continued growth.

     At May 30, 1998, approximately 62% of the Company's assets consist
of inventories, accounts receivable, cash and cash equivalents, and
debt and equity securities.  Prior to 1998, inventories have increased
at a greater rate than sales as a result of broadened product lines,
and safety stock during the relocation of a portion of the Company's
contrast systems manufacturing operations.  The current ratio is 3.43
to 1, with net working capital of $41,597,000 at May 30, 1998, as
compared to the current ratio of 3.07 to 1, with net working capital of
$43,115,000 at May 31, 1997.

     Net capital expenditures, primarily for machinery and equipment,
were $1,897,000 in 1998, as compared to $4,370,000 in 1997 and
$4,231,000 in 1996.  Of the 1997 expenditures, approximately $1,900,000
relates to the acquisition, and related improvements, of a
manufacturing facility by AngioDynamics' Irish subsidiary.  Of the 1996
expenditures, approximately $2,223,000 relates to the purchase of
machinery and equipment and facility improvements in connection with
the Company's manufacturing site relocation.  No material increase in
the aggregate level of capital expenditures is currently contemplated
for 1999.

     The Company is evaluating the impact of the Year 2000 issue on its
business and does not expect to incur significant costs associated with
Year 2000 compliance or that Year 2000 issues will have a material
impact on the Company's business, results of operations or financial

                                  -24-
<PAGE>

condition.  The Year 2000 issue is the result of computer programs
being written using two digits rather than four to define the
applicable year.  The Company's domestic software systems and
applications are currently Year 2000 compliant.  The Company's
international subsidiaries are currently working toward Year 2000
compliance.  The Company has also initiated discussions with its
significant suppliers and customers to ensure that they have
appropriate plans to address Year 2000 issues that may affect the
Company's operations.

     This Form 10-K contains certain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended
(the "Securities Act"), and Section 21E of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), which are intended to be
covered by the safe harbors created thereby.  Investors are cautioned
that all forward-looking statements involve risks and uncertainty,
including without limitation, the ability of the Company to develop its
products, as well as general market conditions, competition and
pricing.  Although the Company believes that the assumptions underlying
the forward-looking statements contained herein are reasonable, any of
the assumptions could be inaccurate, and therefore, there can be no
assurance that the forward-looking statements included in this Form
10-K will prove to be accurate.  In light of the significant
uncertainties inherent in the forward-looking statements included
herein, the inclusion of such information should not be regarded as a
representation by the Company or any other person that the objectives
and plans of the Company will be achieved.


Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     Financial statements and supplementary data required by Part II,
Item 8 are included in Part IV of this form as indexed at Item 14 (a) 1.


Item 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
         AND FINANCIAL DISCLOSURE

     None.







                                  -25-

<PAGE>

                                PART III


     Certain information required by Part III is omitted from this
Annual Report on Form 10-K because the Company will file a definitive
proxy statement within 120 days after the end of its fiscal year
pursuant to Regulation 14A (the "Proxy Statement") for its Annual
Meeting of Stockholders, currently scheduled for October 20, 1998, and
the information included in the Proxy Statement is incorporated herein
by reference.


Item 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

     The following table sets forth certain information with respect to
the Company's officers and directors.

         Name            Age               Positions
         ----            ---               ---------
Howard S. Stern (1)(4)... 67  Chairman of the Board, President, Chief
                                Executive Officer, Director
Arthur L. Zimmet......... 62  Senior Vice President - Special Projects
Sandra D. Baron.......... 46  Vice President - Human Resources
Craig A. Burk............ 45  Vice President - Manufacturing
Joseph A. Cacchioli...... 42  Vice President - Controller
Dennis J. Curtin......... 51  Vice President - Chief Financial Officer
Agustin V. Gago.......... 39  Vice President - International
Eamonn P. Hobbs.......... 45  Vice President - AngioDynamics Division
Joseph J. Palma.......... 56  Vice President - Sales and Marketing
Archie B. Williams....... 47  Vice President - Imaging Products
                                Management
Terry S. Zisowitz........ 51  Vice President - Legal and Regulatory
                                Affairs
Michael A. Davis, M.D.... 57  Medical Director/Technical Director,
                                Director
Paul S. Echenberg (1).... 54  Chairman of the Board of E-Z-EM Canada,
                                Director
James L. Katz CPA, JD.... 62  Director
  (1)(2)(5)
Donald A. Meyer (3)(4)... 64  Director
David P. Meyers.......... 34  Director
Robert M. Topol (1)(2)... 73  Director
  (3)(5)
_______________

(1) Member of Executive Committee
(2) Member of Audit Committee
(3) Member of Nominating Committee
(4) Member of Compensation Committee
(5) Member of Finance Committee

     Directors are elected for a three year term and each holds office
until his successor is elected and qualified.  Officers are elected
annually and serve at the pleasure of the Board of Directors.

     Mr. Stern is a co-founder of the Company and has served as
Chairman of the Board and Director of the Company since its formation
in 1962.  Mr. Stern has also served as President and Chief Executive

                                  -26-
<PAGE>

Officer of the Company since November 1997.  Prior to 1994, Mr. Stern
also served as Chief Executive Officer, and from the formation of the
Company until 1990, he served as President of the Company.  Mr. Stern
is also a director of ITI Medical Technologies, Inc.  The Company has
an investment in ITI Medical Technologies, Inc.

     Mr. Zimmet has served as Senior Vice President - Special Projects
since 1988, and has been an employee of the Company since 1982.

     Ms. Baron has served as Vice President - Human Resources since
1995, and has been an employee of the Company since 1985.

     Mr. Burk has served as Vice President - Manufacturing since 1987.

     Mr. Cacchioli has served as Vice President - Controller since
1988, and has been an employee of the Company since 1984.

     Mr. Curtin has served as Vice President - Chief Financial Officer
since 1995, and previously served as Vice President - Finance from 1985
to 1995.  Mr. Curtin has been an employee of the Company since 1983.

     Mr. Gago has served as Vice President - International since
October 1997, and has been an employee of the Company since 1979.

     Mr. Hobbs has served as Vice President - AngioDynamics Division
since 1991, and has been an employee of the Company since 1988.

     Mr. Palma has served as Vice President - Sales and Marketing since
1996, and previously served as Vice President - Sales from 1995 to
1996.  Mr. Palma has been an employee of the Company since 1994.  Prior
to joining the Company, Mr. Palma served as Director of Sales for the
Imaging Division of Berlex Laboratories (pharmaceutical products) since
1989.

     Mr. Williams has served as Vice President - Imaging Products
Management since 1993, and has been an employee of the Company since
1980.

     Ms. Zisowitz has served as Vice President - Legal and Regulatory
Affairs since 1995, and previously served as Vice President - Legal
Affairs from 1990 to 1995.  Ms. Zisowitz has been an employee of the
Company since 1989.

     Dr. Davis has served as Medical Director/Technical Director and
Director of the Company since 1997, and previously served as Medical
Director and Director of the Company from 1995 to 1996, as Medical
Director from 1994 to 1995, and as Associate Medical Director from 1988
to 1993.  He has been Professor of Radiology and Nuclear Medicine and
Director of the Division of Radiologic Research, University of
Massachusetts Medical Center since 1980.  He is also a director of
MacroChem Corp.

     Mr. Echenberg has been a director of the Company since 1987 and
has served as Chairman of the Board of E-Z-EM Canada since 1994.  He is
the President, Chief Executive Officer and Director of Schroders &
Associates Canada Inc. (investment buy-out advisory services) and
Director of Schroders Ventures Ltd. since 1997.  He is also a founder
and has been a general partner and director of Eckvest Equity Inc.

                                  -27-
<PAGE>

(personal investment and consulting services) since 1989.  He was also
a founder and had been a senior partner of BDE Capital Partners
(investment banking partnership) from 1992 to 1994.  He is also a
director of Lallemand Inc., ISG Technologies, Inc., LDI Research Co.,
Inc., LDI Marketing Co., Inc., Benvest Capital Inc., Colliers MacAuley
Nicholl, Huntington Mills (Canada) Ltd. and ITI Medical Technologies,
Inc.  The Company has investments in ISG Technologies, Inc. and ITI
Medical Technologies, Inc.

     Mr. Katz has been a director of the Company since 1983.  He is a
founder and has been a principal of Chapman Partners LLC (investment
banking) since its organization in 1995.  Previously, he had been the
co-owner and President of Ever Ready Thermometer Co., Inc. from its
acquisition in 1985 until its sale in 1994.  From 1971 until 1980 and
from 1983 until 1985, he held various executive positions with Baxter
International and subsidiaries of Baxter International, including that
of Chief Financial Officer of Baxter International.  He is also a
director of Intec, Inc. and Binax.

     Mr. Meyer has been a director of the Company since 1968.  He is
currently an independent consultant in legal matters to arts and
business organizations, specializing in technical assistance.  He had
been the Executive Director of the Western States Arts Federation,
Santa Fe, New Mexico, which provides and develops regional arts
programs, from 1990 to 1995.  From 1958 through 1990, he was an
attorney practicing in New Orleans, Louisiana.

     Mr. Meyers has been a director of the Company since 1996.  He is
the founder of MedTest Express, Inc., an Atlanta, Georgia provider of
contracted laboratory services for home health agencies, and has served
as its President, Chief Executive Officer and Director since 1994.  For
the five years prior to that, Mr. Meyers was the Vice President of
Operations at Radiation Care, Inc., an Atlanta, Georgia operator of
radiation therapy and diagnostic imaging centers.

     Mr. Topol has been a director of the Company since 1982.  Prior to
his retirement in 1994, he served as an Executive Vice President of
Smith Barney, Inc. (financial services) for more than five years.  He
is also a director of First American Health Concepts, Fund for the
Aging, City Meals on Wheels, American Health Foundation, State
University of New York - Purchase and Redstone Resources Inc.


Item 11.  EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

     The following table sets forth information concerning the
compensation for services, in all capacities for 1998, 1997 and 1996,
of those persons who were, at the end of 1998, Chief Executive Officer
("CEO") (Howard S. Stern) and each of the four most highly compensated
executive officers of the Company other than the CEO (collectively, the
"Named Executive Officers"):






                                  -28-
<PAGE>
<TABLE>
<CAPTION>

                                  Annual Compensation             Long Term Compensation
                              ---------------------------  -------------------------------------
                                                                      Awards             Payouts
                                                           ----------------------------  -------
                                                 Other
                                                 Annual    Restricted                             All Other
    Name and                                    Compensa-    Stock          Options       LTIP    Compensa-
    Principal         Fiscal  Salary    Bonus   tion (1)     Awards    ----------------  Payouts  tion (4)
    Position           Year    ($)       ($)       ($)        ($)       # (2)    # (3)     ($)       ($)
    ---------         ------  ------    -----   ---------  ----------  -------  -------  -------  ---------
<S>                    <C>   <C>       <C>         <C>        <C>       <C>     <C>        <C>     <C>
Howard S. Stern,.....  1998  $250,000  $61,874     None       None       None     None     None    $19,609
Chairman of the Board, 1997   250,000   11,538     None       None       None    8.5227    None      7,090
President and Chief    1996   250,000    None      None       None       None     None     None      7,245
Executive Officer

Eamonn P. Hobbs,.....  1998  $195,000  $21,923     None       None       None     None     None    $ 7,630
Vice President         1997   176,250    6,058     None       None       None   45.4545    None      7,902
                       1996   170,648    None      None       None       None     None     None      8,021

Arthur L. Zimmet,....  1998  $155,000  $40,283     None       None       None     None     None    $ 8,069
Senior Vice President  1997   153,000    7,062     None       None       None     None     None      7,380
                       1996   153,000    None      None       None       None     None     None      7,760

Dennis J. Curtin,....  1998  $146,667  $38,861     None       None       None     None     None    $ 7,637
Vice President         1997   144,000    6,646     None       None       None    3.4091    None      7,534
                       1996   144,000    7,500     None       None       None     None     None      7,880

Agustin V. Gago,.....  1998  $177,581    None      None       None       None     None     None    $ 7,166
Vice President         1997   184,515    None      None       None       None     None     None      7,791
                       1996   130,989    None      None       None      2,185     None     None      6,274
</TABLE>
_______________

(1) The Company has concluded that the aggregate amount of perquisites
    and other personal benefits paid to each of the Named Executive
    Officers for 1998, 1997 and 1996 did not exceed the lesser of 10% of
    such officer's total annual salary and bonus for 1998, 1997 or 1996
    or $50,000; such amounts are, therefore, not reflected in the table.

(2) Options are exercisable in Class B Common Stock of the Company and
    have been retroactively adjusted for the 3% stock dividends
    described in Note M to the Consolidated Financial Statements.

(3) Options are exercisable in Class B Common Stock of AngioDynamics,
    Inc., a wholly-owned subsidiary of the Company.

(4) For 1998, 1997 and 1996, includes for each of the Named Executive
    Officers the amounts contributed by the Company under the Profit-
    Sharing Plan and, as matching contributions, under the companion
    401(k) Plan.  For 1998, also includes for Howard S. Stern fees of
    $12,000 relating to attendance at directors' meetings of
    AngioDynamics.

OPTION/SAR GRANTS TABLE

     The Company did not grant any stock options or stock appreciation
rights to any of the Named Executive Officers during 1998.





                                  -29-
<PAGE>

AGGREGATED OPTION EXERCISES AND FISCAL YEAR-END OPTION VALUE TABLE

     The following table sets forth certain information concerning all
exercises of stock options during 1998 by the Named Executive Officers
and the fiscal year-end value of unexercised stock options on an
aggregated basis:

                                             Number of
                                             Securities     Value of
                                             Underlying    Unexercised
                                            Unexercised    In-the-Money
                                             Options at     Options at
                                            May 30, 1998   May 30, 1998
                                                (#)          ($) (1)
                                           -------------  -------------

                      Shares       Value   Exercisable/   Exercisable/
                   Acquired on   Realized  Unexercisable  Unexercisable
      Name         Exercise (#)     ($)         (2)            (2)
      ----         ------------  --------  -------------  -------------

Howard S. Stern...     None        None       78,786/       $130,365/
                                               None            None

Eamonn P. Hobbs...     None        None       39,595/        $57,373/
                                               None            None

Arthur L. Zimmet..     None        None       50,884/        $74,695/
                                               None            None

Dennis J. Curtin..     None        None       50,556/        $80,269/
                                               None            None

Agustin V. Gago...     None        None       11,274/        $11,644/
                                               None            None
_______________

(1) Options are "in-the-money" if on May 30, 1998, the market price of
    the stock exceeded the exercise price of such options.  At May 30,
    1998, the closing price of the Company's Class A and Class B Common
    Stock was $7.00 and $5.88, respectively.  The value of such options
    is calculated by determining the difference between the aggregate
    market price of the stock covered by the options on May 30, 1998
    and the aggregate exercise price of such options.

(2) Options granted prior to the Company's recapitalization on October
    26, 1992 are exercisable one-half in Class A Common Stock and one-
    half in Class B Common Stock.  Options granted after the
    recapitalization are exercisable in Class B Common Stock.

COMPENSATION OF DIRECTORS

     Directors, who are not employees of the Company, are entitled to
directors fees of $15,000 annually.  Directors, who serve on committees
of the Company and who are not employees or consultants of the Company,
are entitled to a fee of $500 for each committee meeting attended,
except that the chairman of the committee is entitled to a fee of
$1,000 for each committee meeting attended.



                                  -30-
<PAGE>

EMPLOYMENT CONTRACT

     During 1994, the Company entered into an employment contract with
Howard S. Stern.  This employment contract is for a term of eight
years at an annual compensation of $250,000.

REPORT ON REPRICING OF OPTIONS

     During 1998, the Company's Board of Directors approved the
repricing of all outstanding stock options previously granted under the
AngioDynamics Stock Option Plan.  The repricing provided for the
exercise price of 128.41 options to be reduced from $80,000 per share
to $40,000 per share, to reflect current fair value.  The repricing did
not affect the term or vesting period of the options.  The following
table sets forth certain information concerning the repricing of stock
options previously granted to the Named Executive Officers.

<TABLE>
<CAPTION>

                             Number of     Market                            Length of
                            Securities    Price of                           Original
                            Underlying    Stock at     Exercise             Option Term
                              Options      Time of     Price at     New    Remaining at
                             Repriced   Repricing or  Repricing  Exercise     Date of
                            or Amended    Amendment       or       Price   Repricing or
      Name          Date      (#) (1)      ($/Sh)     Amendment   ($/Sh)     Amendment
      ----          ----    ----------  ------------  ---------  --------  ------------
<S>                <C>       <C>           <C>         <C>        <C>       <C>
Howard S. Stern... 5/05/98    8.5227 (2)   $40,000     $80,000    $40,000   106 Months

Eamonn P. Hobbs... 5/05/98   45.4545 (2)   $40,000     $80,000    $40,000   106 Months

Arthur L. Zimmet..  None       None          None        None       None       None

Dennis J. Curtin.. 5/05/98    3.4091 (2)   $40,000     $80,000    $40,000   106 Months

Agustin V. Gago...  None       None          None        None       None       None
</TABLE>
_______________

(1) Options are exercisable in Class B Common Stock of AngioDynamics,
    Inc., a wholly-owned subsidiary of the Company.

(2) Options are exercisable 20% per year over five years from the date
    of grant, provided a threshold event occurs or 100% on the ninth
    anniversary of the grant date, if no threshold event occurs.  A
    threshold event is the earlier of (i) fourteen months after either
    an initial public offering ("IPO") or the spin off of all
    AngioDynamics stock to the Company's shareholders, or (ii) two
    months after the occurrence of both an IPO and the spin off of all
    AngioDynamics stock to the Company's shareholders.

SEVERANCE ARRANGEMENTS

     The information required by this caption is incorporated by
reference to the Company's Proxy Statement under the heading "Severance
Arrangements."

COMPENSATION AND STOCK OPTION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

     The information required by this caption is incorporated by
reference to the Company's Proxy Statement under the heading

                                  -31-
<PAGE>

"Compensation and Stock Option Committee Report on Executive
Compensation."

COMMON STOCK PERFORMANCE

     The information required by this caption is incorporated by
reference to the Company's Proxy Statement under the heading "Common
Stock Performance."


Item 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
          MANAGEMENT

     The following table sets forth information, as of August 3, 1998,
as to the beneficial ownership of the Company's voting Class A Common
Stock by each person known by the Company to own beneficially more than
5% of the Company's voting Class A Common Stock:

 Name and Address of                  Shares             Percent of
  Beneficial Owner              Beneficially Owned         Class
  ----------------              ------------------         -----

Howard S. Stern,................     956,412                23.7
Chairman of the Board,
President, Chief Executive
Officer, Director
717 Main Street
Westbury, NY  11590

Betty S. Meyers,................     820,806                20.3
401 Emerald Street
New Orleans, LA  70124

David P. Meyers,................     311,551 (1)             7.7
Director
1220 Pasadena Avenue
Atlanta, GA  30306

Jonas I. Meyers,................     311,551 (1)             7.7
904 Oakland Avenue
Ann Arbor, MI  48104

Stuart J. Meyers,...............     311,551 (1)             7.7
434 Bellaire Drive
New Orleans, LA  70124

Dimensional Fund Advisors, Inc.,     233,075                 5.8
1299 Ocean Avenue
Santa Monica, CA 90401

Wellington Management Company,..     219,258                 5.4
75 State Street
Boston, MA  02109
_______________

(1) Includes 154,801 shares in which Mr. Meyers has only a remainder
    interest.  Betty S. Meyers holds a life estate in such shares.



                                  -32-
<PAGE>

     The following table sets forth information, as of August 3, 1998,
as to the beneficial ownership of the Company's voting Class A and
nonvoting Class B Common Stock, by (i) each of the Company's directors,
(ii) each of the Company's Named Executive Officers, and (iii) all
directors and executive officers of the Company as a group:

                                  Class A                Class B
                           ---------------------  ---------------------
                              Shares     Percent     Shares     Percent
      Name of              Beneficially     of    Beneficially     of
  Beneficial Owner           Owned (1)    Class     Owned (2)    Class
  ----------------         ------------  -------  ------------  -------

Howard S. Stern,...........   956,412      23.7    1,307,564      21.5
Chairman of the Board,
President, Chief Executive
Officer, Director

David P. Meyers,...........   311,551 (3)   7.7      587,318 (4)   9.8
Director

Arthur L. Zimmet,..........    28,750        *        90,784       1.5
Senior Vice President

Robert M. Topol,...........    25,888        *        65,530       1.1
Director

Paul S. Echenberg,.........     2,888        *        75,094       1.2
Chairman of the Board of
E-Z-EM Canada, Director

Donald A. Meyer,...........    20,067        *        44,059        *
Director

James L. Katz,.............     2,913        *        54,360        *
Director

Dennis J. Curtin,..........     2,052        *        53,382        *
Vice President

Eamonn P. Hobbs,...........        50        *        39,604        *
Vice President

Michael A. Davis, M.D.,....      None        *        38,836        *
Medical Director/Technical
Director, Director

Agustin V. Gago,...........      None        *        11,274        *
Vice President

All directors and executive
  officers as a group (17
  persons)................. 1,350,571      33.4    2,503,746 (4)  37.9
_______________

 *  Does not exceed 1%.

(1) Includes Class A Common Stock shares issuable upon exercise of
    options currently exercisable or exercisable within 60 days from
    August 3, 1998 as follows:  Robert M. Topol (2,388), Paul S.

                                  -33-
<PAGE>

    Echenberg (2,388), Donald A. Meyer (2,388), James L. Katz (2,388)
    and all directors and executive officers as a group (9,552).

(2) Includes Class B Common Stock shares issuable upon exercise of
    options currently exercisable or exercisable within 60 days from
    August 3, 1998 as follows:  Howard S. Stern (78,786), Arthur L.
    Zimmet (50,884), Robert M. Topol (40,638), Paul S. Echenberg
    (74,404), Donald A. Meyer (18,466), James L. Katz (52,549), Dennis
    J. Curtin (50,556), Eamonn P. Hobbs (39,595), Michael A. Davis,
    M.D. (38,836), Agustin V. Gago (11,274) and all directors and
    executive officers as a group (591,929).

(3) Includes 154,801 shares in which Mr. Meyers has only a remainder
    interest.  Betty S. Meyers holds a life estate in such shares.

(4) Includes 175,893 shares in which Mr. Meyers has only a remainder
    interest.  Betty S. Meyers holds a life estate in such shares.
    Also includes 190,035 shares owned by a partnership which Mr.
    Meyers has an interest in.


Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     A facility of the Company located in Westbury, New York is owned
27% by Howard S. Stern, 25% by Betty S. Meyers, a principal
shareholder, 2% by other employees of the Company and 46% by unrelated
parties, which includes a 25% owner who manages the property.
Aggregate rentals, including real estate tax payments, approximated
$146,000 during 1998.  The lease term expired in June 1996 and is
currently being extended on a month-to-month basis.

     During 1998, the Company entered into split dollar life insurance
arrangements with Howard S. Stern (including his spouse) and Betty S.
Meyers (the "insureds").  On an annual basis, the Company makes
interest bearing advances of approximately $100,000 per insured toward
the cost of such life insurance policies.  Interest on the advances is
to be paid to the Company annually by the insureds.  Under collateral
assignment agreements, the proceeds from the policies will first be
paid to the Company to repay the advances it made.  If the policies are
terminated prior to the death of the insured, the Company will be
entitled to the cash surrender value of the policies at that time, and
any shortfall between that amount and the amount of the advances made
by the Company will be repaid to the Company by the insureds.

     The Company has an unsecured, two-year interest bearing note
receivable from Eamonn P. Hobbs, an executive officer of the Company,
in the principal amount of $320,000.  The outstanding principal and
interest matures on September 30, 1999.

     The Company has engaged Michael A. Davis, M.D., a director of the
Company, for consulting services.  Fees for such services were
approximately $132,000 during 1998.

     The Company has engaged Paul S. Echenberg, a director of the
Company, for consulting services.  Fees for such services, including
fees relating to attendance at directors' meetings, were approximately
$99,000 during 1998.


                                  -34-
<PAGE>

                                PART IV


Item 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

                                                                   Page
                                                                   ----
(a)  l.  FINANCIAL STATEMENTS

     The following consolidated financial statements and
supplementary data of Registrant and its subsidiaries required
by Part II, Item 8, are included in Part IV of this report:

     Report of Independent Certified Public Accountants             38

     Consolidated balance sheets - May 30, 1998 and
          May 31, 1997                                              39

     Consolidated statements of operations - fifty-two weeks
          ended May 30, 1998, May 31, 1997 and June 1, 1996         41

     Consolidated statements of stockholders' equity - fifty-
          two weeks ended May 30, 1998, May 31, 1997 and
          June 1, 1996                                              42

     Consolidated statements of cash flows - fifty-two weeks
          ended May 30, 1998, May 31, 1997 and June 1, 1996         43

     Notes to consolidated financial statements                     45

(a)  2.  FINANCIAL STATEMENT SCHEDULES

     The following consolidated financial statement schedule
is included in Part IV of this report:

     Schedule II - Valuation and qualifying accounts                73

     All other schedules are omitted because they are not
applicable, or not required, or because the required information is
included in the consolidated financial statements or notes thereto.

(a)  3.  EXHIBITS

      3(i)  Certificate of Incorporation                            (a)

      3(ii) Amended Bylaws                                          (b)

     10(a)  Agreement and Plan of Merger dated November 7, 1995
            among United States Surgical Corporation, USSC
            Acquisition Corporation, Surgical Dynamics Inc.,
            and E-Z-EM, Inc. and Calmed Laboratories, Inc.
            and E-Z-SUB, Inc.                                       (c)

     10(b)  1983 Stock Option Plan                                  (d)

     10(c)  1984 Directors and Consultants Stock Option Plan        (e)

     10(d)  Income Deferral Program                                 (f)

                                  -35-
<PAGE>

                                                                   Page
                                                                   ----
(a)  3.  EXHIBITS (CONTINUED)

     13     Annual report to security holders                       (g)

     21     Subsidiaries of the Company                             74

     22     Proxy statement to security holders                     (g)

     23     Consent of Independent Certified Public Accountants     75

     27     Financial Data Schedule                                 76

     99     Report of Independent Certified Public Accountants
                 Other than Principal Accountants                   77
_______________

          (a) Incorporated by reference to Exhibit 3(i) of the
              Company's annual report filed on Form 10-K for
              the fiscal year ended May 31, 1997

          (b) Incorporated by reference to Exhibit 3(ii) of the
              Company's annual report filed on Form 10-K for
              the fiscal year ended May 28, 1994

          (c) Incorporated by reference to Exhibit 10 of the
              Company's current report filed on Form 8-K/A
              dated November 22, 1995

          (d) Incorporated by reference to Exhibit 10(a) of the
              Company's quarterly report filed on Form 10-Q for
              the quarterly period ended December 2, 1995

          (e) Incorporated by reference to Exhibit 10(b) of the
              Company's quarterly report filed on Form 10-Q for
              the quarterly period ended December 2, 1995

          (f) Incorporated by reference to Exhibit 10(c) of the
              Company's annual report filed on Form 10-K for
              the fiscal year ended May 29, 1993

          (g) To be filed on a subsequent date

(b)  1.  REPORTS ON FORM 8-K

     No reports on Form 8-K were filed for the quarter ended May 30,
1998.

     Schedules other than those shown above are not submitted as the
subject matter thereof is either not required or is not present in
amounts sufficient to require submission in accordance with the
instructions in Regulation S-X or the information required is included
in the Notes to Consolidated Financial Statements.





                                  -36-
<PAGE>

                               SIGNATURES


     Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.

                                      E-Z-EM, Inc.
                                     ----------------------------------
                                      (Registrant)


Date  August 27, 1998                 /s/ Howard S. Stern
     -----------------               ----------------------------------
                                      Howard S. Stern, Chairman of the
                                      Board, President, Chief Executive
                                      Officer, Director

     Pursuant to the requirements of the Securities Exchange Act of
1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates
indicated.


Date  August 27, 1998                 /s/ Howard S. Stern
     -----------------               ----------------------------------
                                      Howard S. Stern, Chairman of the
                                      Board, President, Chief Executive
                                      Officer, Director


Date  August 26, 1998                 /s/ Dennis J. Curtin
     -----------------               ----------------------------------
                                      Dennis J. Curtin, Vice President-
                                      Chief Financial Officer


Date  August 25, 1998                 /s/ Michael A. Davis
     -----------------               ----------------------------------
                                      Michael A. Davis, Director


Date  August 21, 1998                 /s/ Paul S. Echenberg
     -----------------               ----------------------------------
                                      Paul S. Echenberg, Director


Date  August 25, 1998                 /s/ James L. Katz
     -----------------               ----------------------------------
                                      James L. Katz, Director


Date  August 25, 1998                 /s/ Donald A. Meyer
     -----------------               ----------------------------------
                                      Donald A. Meyer, Director


Date  August 24, 1998                 /s/ David P. Meyers
     -----------------               ----------------------------------
                                      David P. Meyers, Director


Date  August 26, 1998                 /s/ Robert M. Topol
     -----------------               ----------------------------------
                                      Robert M. Topol, Director




                                  -37-
<PAGE>


                         REPORT OF INDEPENDENT
                      CERTIFIED PUBLIC ACCOUNTANTS


Board of Directors
  E-Z-EM, Inc.

We have audited the accompanying consolidated balance sheets of E-Z-EM,
Inc. and Subsidiaries as of May 30, 1998 and May 31, 1997, and the
related consolidated statements of operations, stockholders' equity and
cash flows for the fifty-two weeks ended May 30, 1998, May 31, 1997 and
June 1, 1996.  These financial statements are the responsibility of the
Company's management.  Our responsibility is to express an opinion on
these financial statements based on our audits.  We did not audit the
financial statements of a certain subsidiary, which statements reflect
total assets constituting approximately 19% in 1998 and 15% in 1997 and
net sales constituting approximately 12% in 1998, 10% in 1997 and 12%
in 1996 of the related consolidated totals.  Those statements were
audited by other auditors, whose report thereon has been furnished to
us, and our opinion, insofar as it relates to the amounts included for
this subsidiary, is based solely upon the report of the other auditors.

We conducted our audits in accordance with generally accepted auditing
standards.  Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements
are free of material misstatement.  An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the
financial statements.  An audit also includes assessing the accounting
principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe
that our audits and the report of the other auditors provide a
reasonable basis for our opinion.

In our opinion, based on our audits and the report of the other
auditors, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of E-Z-EM,
Inc. and Subsidiaries as of May 30, 1998 and May 31, 1997, and the
consolidated results of their operations and their consolidated cash
flows for the fifty-two weeks ended May 30, 1998, May 31, 1997 and
June 1, 1996, in conformity with generally accepted accounting
principles.

We have also audited the financial statement schedule listed in the
Index at Item 14(a)(2).  In our opinion, this schedule presents fairly,
in all material respects, the information required to be set forth
therein.



                                     GRANT THORNTON LLP
                                     Certified Public Accountants



Melville, New York
July 27, 1998


                                  -38-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

                      CONSOLIDATED BALANCE SHEETS
                             (in thousands)


                                                  May 30,      May 31,
          ASSETS                                   1998         1997
                                                  ------       ------

CURRENT ASSETS
  Cash and cash equivalents                      $ 4,654     $  4,484
  Debt and equity securities                       3,475       10,991
  Accounts receivable, principally
    trade, net of allowance for
    doubtful accounts of $1,148 in
    1998 and $930 in 1997                         21,348       16,971
  Inventories                                     26,764       27,351
  Other current assets                             2,499        4,147
                                                  ------      -------
      Total current assets                        58,740       63,944

INVESTMENT IN AFFILIATE                            1,121

PROPERTY, PLANT AND EQUIPMENT - AT COST,
  less accumulated depreciation and
  amortization                                    21,917       23,418

COST IN EXCESS OF FAIR VALUE OF NET
  ASSETS ACQUIRED, less accumulated
  amortization of $441 in 1998 and
  $447 in 1997                                       446          489

INTANGIBLE ASSETS, less accumulated
  amortization of $652 in 1998 and
  $594 in 1997                                     2,546        7,057

DEBT AND EQUITY SECURITIES                         2,057        2,081

OTHER ASSETS                                       3,879        3,731
                                                  ------      -------
                                                 $90,706     $100,720
                                                  ======      =======















The accompanying notes are an integral part of these statements.

                                  -39-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

                      CONSOLIDATED BALANCE SHEETS
            (in thousands, except share and per share data)


                                                  May 30,      May 31,
   LIABILITIES AND STOCKHOLDERS' EQUITY            1998         1997
                                                  ------       ------

CURRENT LIABILITIES
  Notes payable                                  $ 3,041     $  7,029
  Current maturities of long-term debt               287          517
  Accounts payable                                 6,265        6,168
  Accrued liabilities                              6,958        6,829
  Accrued income taxes                               592          286
                                                  ------      -------
      Total current liabilities                   17,143       20,829

LONG-TERM DEBT, less current maturities              606          842

OTHER NONCURRENT LIABILITIES                       1,734        1,805

COMMITMENTS AND CONTINGENCIES
                                                  ------      -------
      Total liabilities                           19,483       23,476
                                                  ------      -------
STOCKHOLDERS' EQUITY
  Preferred stock, par value $.10 per share -
    authorized, 1,000,000 shares; issued, none        -            -
  Common stock
    Class A (voting), par value $.10 per
      share - authorized, 6,000,000 shares;
      issued and outstanding, 4,035,346
      shares in 1998 and 1997                        403          403
    Class B (nonvoting), par value $.10 per
      share - authorized, 10,000,000 shares;
      issued and outstanding, 5,999,073
      shares in 1998 and 5,600,883 shares
      in 1997                                        600          560
  Additional paid-in capital                      21,643       19,073
  Retained earnings                               49,090       57,087
  Unrealized holding gain on debt and equity
    securities                                     1,344        1,332
  Cumulative translation adjustments              (1,857)      (1,211)
                                                  ------      -------
      Total stockholders' equity                  71,223       77,244
                                                  ------      -------
                                                 $90,706     $100,720
                                                  ======      =======








The accompanying notes are an integral part of these statements.

                                  -40-
<PAGE>

                       E-Z-EM, Inc. and Subsidiaries

                   CONSOLIDATED STATEMENTS OF OPERATIONS
                   (in thousands, except per share data)


                                             Fifty-two weeks ended
                                        -------------------------------
                                        May 30,     May 31,     June 1,
                                         1998        1997        1996
                                        ------      ------      ------

Net sales                             $102,884     $97,324     $91,932

Cost of goods sold                      65,451      60,754      55,518
                                       -------      ------      ------
      Gross profit                      37,433      36,570      36,414
                                       -------      ------      ------
Operating expenses
  Selling and administrative            33,001      34,600      30,134
  Research and development               5,662       6,881       5,323
  Impairment of long-lived assets        4,121
                                        ------      ------      ------
    Total operating expenses            42,784      41,481      35,457
                                        ------      ------      ------
      Operating profit (loss)           (5,351)     (4,911)        957

Other income (expense)
  Interest income                          692         830         735
  Interest expense                        (694)       (517)       (264)
  Equity in losses of affiliate           (219)
  Other, net                                38          68         512
                                         -----       -----      ------
      Earnings (loss) from continuing
        operations before income taxes  (5,534)     (4,530)      1,940

Income tax provision (benefit)             433      (1,322)        243
                                         -----       -----      ------
      Earnings (loss) from
        continuing operations           (5,967)     (3,208)      1,697

Discontinued operation:
  Losses from operations, net of
    income tax provision of $10                                   (209)
  Gain on sale, net of income tax
    provision of $6,019                                         19,520
                                         -----       -----      ------
      NET EARNINGS (LOSS)              $(5,967)    $(3,208)    $21,008
                                         =====       =====      ======
Basic earnings (loss) per common share
  Continuing operations                $  (.60)    $  (.33)    $   .17
  Discontinued operation                   .00         .00        1.99
  Total operations                        (.60)       (.33)       2.16

Diluted earnings (loss) per common share
  Continuing operations                $  (.60)    $  (.33)    $   .17
  Discontinued operation                   .00         .00        1.87
  Total operations                        (.60)       (.33)       2.04

The accompanying notes are an integral part of these statements.

                                  -41-
<PAGE>

<TABLE>
                                                 E-Z-EM, Inc. and Subsidiaries

                                        CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                               Fifty-two weeks ended May 30, 1998, May 31, 1997 and June 1, 1996
                                               (in thousands, except share data)

<CAPTION>
                                                                                           Unrealized
                                   Class A            Class B                             holding gain
                                 common stock       common stock    Additional              on debt     Cumulative
                              -----------------  -----------------   paid-in    Retained   and equity   translation
                                Shares   Amount    Shares   Amount   capital    earnings   securities   adjustments   Total
                              ---------  ------  ---------  ------  ----------  --------   ----------   -----------  -------
<S>                           <C>         <C>    <C>         <C>     <C>        <C>          <C>        <C>          <C>
Balance at June 3, 1995       4,032,532   $403   4,785,462   $479    $11,570    $44,953      $1,786     $(1,301)     $57,890
Exercise of stock options         2,813            145,369     14        759                                             773
Income tax benefits on
  stock options exercised                                                246                                             246
Issuance of stock                     1                933                 5                                               5
3% common stock dividend                           267,851     27      2,585     (2,614)                                  (2)
Net earnings                                                                     21,008                               21,008
Unrealized holding gain on
  debt and equity securities                                                                    574                      574
Foreign currency translation
  adjustments                                                                                               109          109
                              ---------    ---   ---------    ---     ------     ------       -----       -----       ------
Balance at June 1, 1996       4,035,346    403   5,199,615    520     15,165     63,347       2,360      (1,192)      80,603
Exercise of stock options                          117,919     12        600                                             612
Income tax benefits on
  stock options exercised                                                261                                             261
Compensation related to
  stock option plans                                                       2                                               2
Issuance of stock                                    3,022                24                                              24
3% common stock dividend                           280,327     28      3,021     (3,052)                                  (3)
Net loss                                                                         (3,208)                              (3,208)
Unrealized holding loss on
  debt and equity securities                                                                 (1,028)                  (1,028)
Foreign currency translation
  adjustments                                                                                               (19)         (19)
                              ---------    ---   ---------    ---     ------     ------       -----       -----       ------
Balance at May 31, 1997       4,035,346    403   5,600,883    560     19,073     57,087       1,332      (1,211)      77,244
Exercise of stock options                          107,417     11        470                                             481
Income tax benefits on
  stock options exercised                                                 88                                              88
Compensation related to
  stock option plans                                                       7                                               7
Issuance of stock                                    1,025                 6                                               6
3% common stock dividend                           289,748     29      1,999     (2,030)                                  (2)
Net loss                                                                         (5,967)                              (5,967)
Unrealized holding gain on
  debt and equity securities                                                                     12                       12
Foreign currency translation
  adjustments                                                                                              (646)        (646)
                              ---------    ---   ---------    ---     ------     ------       -----       -----       ------
Balance at May 30, 1998       4,035,346   $403   5,999,073   $600    $21,643    $49,090      $1,344     $(1,857)     $71,223
                              =========    ===   =========    ===     ======     ======       =====       =====       ======
</TABLE>

The accompanying notes are an integral part of these statements.

                                  -42-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

                 CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (in thousands)


                                             Fifty-two weeks ended
                                        -------------------------------
                                        May 30,     May 31,     June 1,
                                         1998        1997        1996
                                        ------      ------      ------

Cash flows from operating activities:
  Net (loss) earnings                  $(5,967)    $(3,208)    $21,008
  Adjustments to reconcile net (loss)
    earnings to net cash used in
    operating activities
      Depreciation and amortization      3,315       3,037       2,552
      Impairment of long-lived assets    4,121
      Provision for doubtful accounts      286         451         176
      Equity in losses of affiliate        219
      Gain on disposal of business                             (25,539)
      (Gain) loss on sale of assets        (11)          2        (193)
      Minority share of subsidiary's
        operations                                                (200)
      Deferred tax (benefit) provision     (64)       (147)         60
      Other non-cash items                   7          20
      Changes in operating assets
        and liabilities, net of
        acquisition and disposition
          Accounts receivable           (4,663)     (1,270)       (907)
          Inventories                      587      (3,421)     (3,123)
          Other current assets           1,565      (1,111)       (446)
          Other assets                    (588)       (137)       (754)
          Accounts payable                  97       1,073        (312)
          Accrued liabilities              127         608         905
          Accrued income taxes             310         (54)         22
          Other noncurrent liabilities     (21)        (25)        168
                                        ------      ------      ------
            Net cash used in operating
              activities                  (680)     (4,182)     (6,583)*
                                        ------      ------      ------
Cash flows from investing activities:
  Additions to property, plant and
    equipment                           (1,897)     (4,370)     (4,231)
  Acquisition of business                           (7,096)
  Investment in affiliate               (1,340)
  Proceeds from disposal of business       510                  26,785
  Proceeds from sale of assets              50         114         485
  Held-to-maturity securities
    Purchases                                                 (104,253)
    Proceeds from maturity                                     105,846
  Available-for-sale securities
    Purchases                          (12,290)    (22,735)    (39,750)
    Proceeds from sale                  19,806      31,998      19,995
                                        ------      ------      ------
      Net cash provided by (used in)
        investing activities             4,839      (2,089)      4,877
                                        ------      ------      ------
The accompanying notes are an integral part of these statements.

                                  -43-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

           CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
                             (in thousands)


                                             Fifty-two weeks ended
                                        -------------------------------
                                        May 30,     May 31,     June 1,
                                         1998        1997        1996
                                        ------      ------      ------

Cash flows from financing activities:
  Repayments of debt                   $(7,704)    $(1,023)     $ (910)
  Proceeds from issuance of debt         3,619       7,592       1,121
  Proceeds from issuance of loan
    by minority shareholder                                        238
  Proceeds from exercise of stock
    options, including related
    income tax benefits                    569         873       1,019
  Proceeds from issuance of stock in
    connection with the stock
    purchase plan                            6          24           5
                                         -----       -----       -----
      Net cash (used in) provided by
        financing activities            (3,510)      7,466       1,473
                                         -----       -----       -----
Effect of exchange rate changes on
  cash and cash equivalents               (479)        (74)       (366)
                                         -----       -----       -----
      INCREASE (DECREASE) IN CASH
        AND CASH EQUIVALENTS               170       1,121        (599)

Cash and cash equivalents
  Beginning of year                      4,484       3,363       3,962
                                         -----       -----       -----
  End of year                           $4,654      $4,484      $3,363
                                         =====       =====       =====

Supplemental disclosures of cash
  flow information:
    Cash paid during the year for:
      Interest                          $  650      $  398      $  136
                                         =====       =====       =====
      Income taxes (net of $1,337,
        $686 and $508 in refunds
        in 1998, 1997 and 1996,
        respectively)                   $ (762)     $    6      $6,319
                                         =====       =====       =====







* Includes income taxes paid on the disposition of Surgical Dynamics
  Inc. of approximately $6,019.

The accompanying notes are an integral part of these statements.

                                  -44-
<PAGE>


                     E-Z-EM, Inc. and Subsidiaries

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

  The summary of significant accounting policies is presented to assist
    the reader in understanding and evaluating the consolidated
    financial statements.  These policies are in conformity with
    generally accepted accounting principles and have been applied
    consistently in all material respects.

  Nature of Business
  ------------------
  The Company is primarily engaged in developing, manufacturing and
    marketing diagnostic products used by radiologists and other
    physicians during image-assisted procedures to detect anatomic
    abnormalities and diseases.  The Company also designs, develops,
    manufactures and markets, through its wholly-owned subsidiary,
    AngioDynamics, Inc. ("AngioDynamics"), a variety of therapeutic and
    diagnostic products, for use principally in the diagnosis and
    treatment of peripheral vascular disease.

  Basis of Consolidation
  ----------------------
  The consolidated financial statements include the accounts of E-Z-EM,
    Inc. and all 100%-owned subsidiaries (the "Company").  All
    significant intercompany balances and transactions have been
    eliminated.  The Company's approximate 23% interest in an affiliate
    is accounted for by the equity method.  Pursuant to this method,
    such investment is recorded at cost and adjusted by the Company's
    share of undistributed earnings (or losses).  Surgical Dynamics
    Inc. ("SDI"), a former 51%-owned subsidiary, has been reported as a
    discontinued operation and, accordingly, the gain from the sale of
    SDI and the Company's proportionate share of losses from operations
    of SDI have been classified as a discontinued operation for 1996 in
    the accompanying consolidated statements of operations.  The
    discontinued operation has not been segregated in the accompanying
    statements of consolidated cash flows and, therefore, amounts for
    certain captions will not agree with the respective consolidated
    statements of operations.

  Operations outside the U.S. are included in the consolidated
    financial statements and consist of:  a subsidiary operating a
    mining and chemical processing operation in Nova Scotia, Canada and
    a manufacturing and marketing facility in Montreal, Canada; a
    subsidiary manufacturing products located in Puerto Rico; a
    subsidiary manufacturing and marketing products located in Japan; a
    subsidiary promoting and distributing products located in Holland;
    a subsidiary promoting and distributing products located in the
    United Kingdom; and a subsidiary manufacturing products located in
    Ireland.




                                  -45-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

  Fiscal Year
  -----------
  The Company reports on a fiscal year which concludes on the Saturday
    nearest to May 31.  Fiscal years 1998, 1997 and 1996 ended on May
    30, 1998, May 31, 1997 and June 1, 1996, respectively, for
    reporting periods of fifty-two weeks.

  Cash and Cash Equivalents
  -------------------------
  The Company considers all unrestricted highly liquid investments
    purchased with a maturity of less than three months to be cash
    equivalents.  Included in cash equivalents are certificates of
    deposit and Eurodollar investments of $1,220,000 and $2,443,000 at
    May 30, 1998 and May 31, 1997, respectively.  The carrying amount
    of these financial instruments reasonably approximates fair value
    because of their short maturity.  Foreign-denominated cash and cash
    equivalents aggregated $2,359,000 and $1,141,000 at May 30, 1998
    and May 31, 1997, respectively.

  Debt and Equity Securities
  --------------------------
  Debt and equity securities are classified as "available-for-sale
    securities" and reported at fair value, with unrealized gains and
    losses excluded from operations and reported as a separate
    component of stockholders' equity, net of the related tax effects.
    Cost is determined using the specific identification method.

  Inventories
  -----------
  Inventories are stated at the lower of cost (on the first-in, first-
    out method) or market.  Appropriate consideration is given to
    deterioration, obsolescence and other factors in evaluating net
    realizable value.

  Property, Plant and Equipment
  -----------------------------
  Property, plant and equipment are stated at cost, less accumulated
    depreciation.  Depreciation is computed principally using the
    straight-line method over the estimated useful lives of the assets.
    Leasehold improvements are amortized over the terms of the related
    leases or the useful life of the improvements, whichever is
    shorter.  Expenditures for repairs and maintenance are charged to
    expense as incurred.  Renewals and betterments are capitalized.
    Depreciation expense from continuing operations was $2,827,000,
    $2,721,000 and $2,308,000 in 1998, 1997 and 1996, respectively.





                                  -46-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

  Cost in Excess of Fair Value of Net Assets Acquired
  ---------------------------------------------------
  The cost in excess of fair value of net assets acquired ("goodwill")
    is being amortized on a straight-line basis over 40 years.
    Amortization from continuing operations was $17,000, $64,000 and
    $73,000 in 1998, 1997 and 1996, respectively.

  Intangible Assets
  -----------------
  Intangible assets are being amortized on a straight-line basis over
    the estimated useful lives of the respective assets ranging from
    three to fifteen and one-half years.  Amortization from continuing
    operations was $471,000, $252,000 and $47,000 in 1998, 1997 and
    1996, respectively.

  On an ongoing basis, management reviews the valuation and
    amortization of goodwill and intangible assets to determine
    possible impairment by considering current operating results and
    comparing the carrying values to the anticipated undiscounted
    future cash flows of the related assets.  See Note B - Asset
    Purchase and Impairment Charge.

  Income Taxes
  ------------
  Deferred income taxes are recognized for temporary differences
    between financial statement and income tax bases of assets and
    liabilities and loss carryforwards and tax credit carryforwards for
    which income tax benefits are expected to be realized in future
    years.  A valuation allowance has been established to reduce
    deferred tax assets as it is more likely than not that all, or some
    portion, of such deferred tax assets will not be realized.  The
    effect on deferred taxes of a change in tax rates is recognized in
    income in the period that includes the enactment date.

  Foreign Currency Translation
  ----------------------------
  In accordance with Statement of Financial Accounting Standards No.
    52, "Foreign Currency Translation," the Company has determined that
    the functional currency for its foreign subsidiaries is the local
    currency.  This assessment considers that the day-to-day operations
    are not dependent upon the economic environment of the parent's
    functional currency, financing is effected through their own
    operations, and the foreign operations primarily generate and
    expend foreign currency.  Foreign currency translation adjustments
    are accumulated as a separate component of stockholders' equity.





                                  -47-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

  Earnings (Loss) Per Common Share
  --------------------------------
  In 1998, the Company adopted Statement of Financial Accounting
    Standards ("SFAS") No. 128, "Earnings Per Share," which requires
    public companies to present basic earnings per share and, if
    applicable, diluted earnings per share.  In accordance with SFAS
    No. 128, all comparative periods have been restated, if applicable.
    Basic earnings per share are based on the weighted average number
    of common shares outstanding without consideration of potential
    common stock.  Diluted earnings per share are based on the weighted
    average number of common and potential common shares outstanding.
    The calculation takes into account the shares that may be issued
    upon exercise of stock options, reduced by the shares that may be
    repurchased with the funds received from the exercise, based on the
    average price during the period.  Potential common shares were
    excluded from the diluted calculation for 1998 and 1997, as their
    effects were anti-dilutive.

  The following table sets forth the reconciliation of the weighted
    average number of common shares:

                                     1998         1997         1996
                                    ------       ------       ------
    Basic                         9,952,482    9,870,732    9,711,976
    Effect of dilutive
      securities (stock options)                              602,890
                                  ---------    ---------   ----------
    Diluted                       9,952,482    9,870,732   10,314,866

  The weighted average number of common shares and the per share
    amounts for all periods presented have been retroactively restated
    to reflect the total shares issued after the 3% stock dividends
    described in Note M.

  Use of Estimates
  ----------------
  The preparation of financial statements in conformity with generally
    accepted accounting principles requires management to make
    estimates and assumptions that affect the reported amounts of
    assets and liabilities and disclosures of contingent assets and
    liabilities at year-end and the reported amounts of revenues and
    expenses during the reporting period.  Actual results could differ
    from those estimates.








                                  -48-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

  New Pronouncements Not Yet Adopted
  ----------------------------------
  In June 1997, the Financial Accounting Standards Board issued SFAS
    No. 130, "Reporting Comprehensive Income," which is effective for
    the Company's 1999 fiscal year.  The statement addresses the
    reporting and displaying of comprehensive income and its
    components.  Earnings per share will only be reported for net
    income and not for comprehensive income.  Adoption of SFAS No. 130
    relates to disclosure within the financial statements and is not
    expected to have a material effect on the Company's financial
    statements.

  In June 1997, the Financial Accounting Standards Board issued SFAS
    No. 131, "Disclosures about Segments of an Enterprise and Related
    Information," which is effective for the Company's 1999 fiscal
    year.  The statement redefines how operating segments are
    determined and requires disclosure of certain financial and
    descriptive information about a company's operating segments.  The
    Company has not completed its evaluation of the effects that SFAS
    No. 131 will have on its financial reporting and disclosures.


NOTE B - ASSET PURCHASE AND IMPAIRMENT CHARGE

  On January 8, 1997, the Company purchased certain assets of Leocor,
    Inc. ("Leocor") and certain other assets directly from a principal
    shareholder of Leocor for approximately $7,096,000, including
    acquisition costs.  Leocor developed and manufactured angioplasty
    catheters.  No liabilities were assumed in connection with this
    acquisition.  The acquisition was accounted for under the purchase
    method with the results of operations being included in the
    Company's consolidated statement of operations from the date of
    acquisition.  Prior to the impairment charge described below, the
    fair values of the intangible assets acquired ($6,543,000),
    representing technology, trademarks, licenses and know-how, were
    amortized on a straight-line basis over fifteen years.

  In connection with this acquisition, the Company also entered into a
    consulting agreement with the principal shareholder of Leocor for
    consideration of $200,000.  The term of this consulting agreement
    was for a period of two years from the acquisition date of January
    8, 1997.  As a result of the intangible asset impairment, the
    unamortized consideration was written off in 1998.







                                  -49-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE B - ASSET PURCHASE AND IMPAIRMENT CHARGE (continued)

  The following unaudited pro forma information has been prepared
    assuming Leocor had been acquired as of the beginning of the
    periods presented, after giving effect to certain adjustments,
    including amortization of intangible assets, interest expense on
    the acquisition debt and related income tax effects.  The pro forma
    information is presented for informational purposes only and is not
    necessarily indicative of what would have occurred if the
    acquisition had been made as of those dates.

  Pro Forma Information (Unaudited)

                                                   1997         1996
                                                  ------       ------
                                                     (in thousands,
                                                 except per share data)

    Net sales                                    $97,882      $92,905
    Earnings (loss) from continuing
      operations                                  (3,651)         826
    Earnings (loss) per common share
      from continuing operations:
        Basic                                       (.37)         .09
        Diluted                                     (.37)         .08

  In accordance with Statement of Financial Accounting Standards No.
    121, "Accounting for the Impairment of Long-Lived Assets and for
    Long-Lived Assets to be Disposed Of," the Company recorded an
    impairment charge in 1998, with no associated tax benefit, of
    $4,121,000, or $.41 per share, relating to certain long-lived
    assets pertaining to the Leocor acquisition and used in the
    cardiovascular market.  The Company determined that the revenue
    potential of this technology, as it relates to the cardiovascular
    market, was impaired due to increased competition and price erosion
    for coronary stents and angioplasty products and the Company's
    strategic decision to commercially exploit this technology in the
    interventional radiology market.  The Company is seeking a
    strategic business partner with an existing cardiovascular sales
    and marketing franchise in order to be successful in the
    cardiovascular market, although there can be no assurances that
    such a partner can be found.  The charge represents the difference
    between the carrying value of intangible assets and the fair market
    value of these assets based on estimated future cash flows
    discounted at a rate commensurate with the risk involved.  The
    charge had no impact on the Company's cash flow or its ability to
    generate cash flow in the future.  As a result of the impairment
    charge, amortization expense related to these assets will decrease
    by approximately $250,000 per year, with the remaining intangible
    assets being amortized on a straight-line basis over the remaining
    estimated useful lives of approximately eight years.


                                  -50-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE C - DISCONTINUED OPERATION

  On November 22, 1995 (the "Closing Date"), E-Z-EM, Inc. completed the
    sale of all of the capital stock of SDI held by E-Z-EM, Inc.
    through its subsidiary, E-Z-SUB, Inc., (collectively, the
    "Company") to United States Surgical Corporation ("USSC") pursuant
    to the terms of an Agreement and Plan of Merger Agreement dated
    November 7, 1995 (the "Merger Agreement") by and among USSC, USSC
    Acquisition Corporation, SDI, CalMed Laboratories, Inc. ("CalMed")
    and the Company.  As of the Closing Date, the Company owned 51%
    (approximately 47% on a diluted basis after taking into account
    outstanding options) of the outstanding capital stock of SDI and
    CalMed, a company not affiliated with E-Z-EM, Inc., owned 49%
    (approximately 45% on a diluted basis after taking into account
    outstanding options) of the outstanding capital stock of SDI.  The
    aggregate consideration paid for SDI was $59,900,000 in cash, which
    amount included repayment by USSC of $200,000 of loans owed by SDI
    to its shareholders.  After closing costs and payments made to
    option holders, the Company received cash proceeds of $27,073,000
    at closing and $510,000 during 1998 for the sale of its interest in
    SDI.  The $510,000 consideration had been held back, pursuant to
    the terms of the Merger Agreement, by USSC as a nonexclusive source
    of indemnification for potential breaches of representations and
    warranties.  As a result of this sale, the Company recognized a
    gain, pretax, of approximately $25,539,000, after-tax of
    approximately $19,520,000, or $2.01 per common share on a basic EPS
    basis.  The effective tax rate of 24% on the gain on the sale of
    SDI differs from the Federal statutory tax rate of 35% due
    primarily to the utilization of previously unrecorded tax loss and
    tax credit carryforwards.

  SDI has been reported as a discontinued operation and, accordingly,
    the gain from the sale of SDI and the Company's proportionate share
    of losses from operations of SDI have been classified as a
    discontinued operation for 1996 in the accompanying consolidated
    statements of operations.  Revenues attributable to the SDI
    operations were approximately $3,475,000 for the period June 4,
    1995 through November 22, 1995.  Changes in operating assets and
    liabilities reflected in the consolidated statements of cash flows
    include amounts pertaining to the operations of SDI.












                                  -51-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE D - INVESTMENT IN AFFILIATE

  In August 1997, the Company acquired approximately 23% of ITI Medical
    Technologies, Inc. ("ITI") for $1,340,000, including acquisition
    related expenses of $40,000.  ITI is a California corporation,
    based in Livermore, California, which develops and manufactures MRI
    diagnostic and therapeutic medical devices.  The Company's
    investment in ITI is accounted for by the equity method.  The
    Company's investment in ITI has been reduced by its proportionate
    share of losses in 1998 of approximately $219,000.


NOTE E - DEBT AND EQUITY SECURITIES

  Debt and equity securities at May 30, 1998 consist of the following:

                                                             Unrealized
                                    Amortized      Fair        holding
                                      cost        value         gain
                                    ---------     -----      ----------
                                              (in thousands)

    Current
    -------
      Available-for-sale securities
        (carried on the balance
        sheet at fair value)
          Debt securities            $3,470       $3,470
          Other                           5            5
                                      -----        -----
                                     $3,475       $3,475
                                      =====        =====

    Noncurrent
    ----------
      Available-for-sale securities
        (carried on the balance
        sheet at fair value)
          Equity securities          $1,626       $2,056         $430
          Other                           1            1
                                      -----        -----          ---
                                     $1,627       $2,057         $430
                                      =====        =====          ===













                                  -52-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE E - DEBT AND EQUITY SECURITIES (continued)

  Debt and equity securities at May 31, 1997 consist of the following:

                                                             Unrealized
                                    Amortized      Fair        holding
                                      cost        value         gain
                                    ---------     -----      ----------
                                              (in thousands)

    Current
    -------
      Available-for-sale securities
        (carried on the balance
        sheet at fair value)
          Debt securities           $10,660      $10,660
          Equity securities             250          250
          Other                          81           81
                                     ------       ------
                                    $10,991      $10,991
                                     ======       ======

    Noncurrent
    ----------
      Available-for-sale securities
        (carried on the balance
        sheet at fair value)
          Equity securities          $1,669       $2,080         $411
          Other                           1            1
                                      -----        -----          ---
                                     $1,670       $2,081         $411
                                      =====        =====          ===


NOTE F - INVENTORIES

  Inventories consist of the following:

                                                  May 30,      May 31,
                                                   1998         1997
                                                  ------       ------
                                                     (in thousands)

    Finished goods                               $13,846      $14,170
    Work in process                                1,474        1,639
    Raw materials                                 11,444       11,542
                                                  ------       ------
                                                 $26,764      $27,351
                                                  ======       ======








                                  -53-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE G - PROPERTY, PLANT AND EQUIPMENT, AT COST

  Property, plant and equipment are summarized as follows:

                                   Estimated
                                    useful        May 30,      May 31,
                                     lives         1998         1997
                                   ---------      ------       ------
                                                     (in thousands)

    Building and building
      improvements              10 to 39 years   $13,337      $13,642
    Machinery and equipment      2 to 10 years    26,964       25,930
    Leasehold improvements       Term of lease     1,645        1,610
                                                  ------       ------
                                                  41,946       41,182
    Less accumulated depreciation
      and amortization                            23,506       21,293
                                                  ------       ------
                                                  18,440       19,889
    Land                                           3,477        3,529
                                                  ------       ------
                                                 $21,917      $23,418
                                                  ======       ======


NOTE H - INCOME TAXES

  Income tax expense (benefit) from continuing operations analyzed by
    category and by income statement classification is summarized as
    follows:

                                      1998         1997         1996
                                     ------       ------       ------
                                              (in thousands)
    Current
      Federal                         $(159)     $  (724)        $413
      State and local                   131           54           31
      Foreign                           525         (505)        (261)
                                        ---        -----          ---
        Subtotal                        497       (1,175)         183

    Deferred                            (64)        (147)          60
                                        ---        -----          ---
        Total                         $ 433      $(1,322)        $243
                                        ===        =====          ===








                                  -54-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE H - INCOME TAXES (continued)

  Temporary differences which give rise to deferred tax assets and
    liabilities are summarized as follows:

                                                  May 30,      May 31,
                                                   1998         1997
                                                  ------       ------
                                                     (in thousands)
    Deferred tax assets
      Difference between book and tax basis
        in investment sold to Canadian
        subsidiary                                $1,137       $1,137
      Tax credit carryforwards                       642          477
      Tax operating loss carryforwards               370          313
      Alternative minimum tax ("AMT")
        credit carryforward                          125
      Impairment of long-lived assets              1,507
      Expenses incurred not currently deductible   1,435        1,321
      Unrealized investment losses                   951          962
      Deferred compensation costs                    548          554
      Inventories                                    591          412
      Other                                           87          132
                                                   -----        -----
        Gross deferred tax asset                   7,393        5,308
                                                   -----        -----
    Deferred tax liabilities
      Excess tax over book depreciation            1,054        1,096
      Unrealized investment gains                     37           41
      Tax on unremitted profits of Puerto
        Rican subsidiary                              86           76
      Other                                           20           60
                                                   -----        -----
        Gross deferred tax liability               1,197        1,273

    Valuation allowance                           (5,017)      (2,945)
                                                   -----        -----
        Net deferred tax asset                    $1,179       $1,090
                                                   =====        =====

  In 1994, the Company sold to its Canadian subsidiary warrants to
    purchase 396,396 shares of stock in ISG Technologies, Inc.  This
    transaction generated a capital gain for tax purposes of
    approximately $3,344,000, utilizing a portion of the Company's
    capital loss carryforward and giving rise to a temporary difference
    pertaining to the difference between the financial statement and
    tax basis in this asset.

  During 1996, the Company utilized tax operating and capital losses,
    tax credit and AMT credit carryforwards of approximately
    $8,279,000, $596,000 and $121,000, respectively, in connection with
    the sale of SDI described in Note C.

                                  -55-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE H - INCOME TAXES (continued)

  If not utilized, the tax operating loss carryforwards will expire in
    various amounts over the years 2001 through 2003.  The tax credit
    carryforwards will expire in various amounts over the years 1999
    through 2013.

  Deferred income taxes are provided for the expected Tollgate tax on
    the undistributed earnings of the Company's Puerto Rican
    subsidiary, which are expected to be distributed at some time in
    the future.

  At May 30, 1998, undistributed earnings of certain foreign
    subsidiaries aggregated $13,581,000 which will not be subject to
    U.S. tax until distributed as dividends.  Any taxes paid to foreign
    governments on these earnings may be used, in whole or in part, as
    credits against the U.S. tax on any dividends distributed from such
    earnings.  It is not practical to estimate the amount of U.S. tax,
    if any, that might be payable on the eventual remittance of such
    earnings.  On remittance, certain foreign countries impose
    withholding taxes that are then available for use as credits
    against a U.S. tax liability, if any, subject to certain
    limitations.  The amount of withholding tax that would be payable
    on remittance of the entire amount of undistributed earnings would
    approximate $679,000.

  Deferred tax assets and liabilities are included in the consolidated
    balance sheets as follows:

                                                  May 30,      May 31,
                                                   1998         1997
                                                  ------       ------
                                                     (in thousands)

      Current - Accrued income taxes              $  (86)      $ (103)
      Noncurrent - Other assets                    1,265        1,193
                                                   -----        -----
        Net deferred tax asset                    $1,179       $1,090
                                                   =====        =====

  Earnings (loss) from continuing operations before income taxes for
    U.S. and international operations consist of the following:

                                      1998         1997         1996
                                     ------       ------       ------
                                              (in thousands)

      U.S.                          $(5,225)     $(1,977)      $2,280
      International                    (309)      (2,553)        (340)
                                      -----        -----        -----
                                    $(5,534)     $(4,530)      $1,940
                                      =====        =====        =====


                                  -56-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE H - INCOME TAXES (continued)

  The Company's consolidated income tax provision (benefit) has
    differed from the amount which would be provided by applying the
    U.S. Federal statutory income tax rate to the Company's earnings
    (loss) from continuing operations before income taxes for the
    following reasons:

                                      1998         1997         1996
                                     ------       ------       ------
                                              (in thousands)

    Income tax provision (benefit)  $   433      $(1,322)        $243
    Effect of:
      State income taxes, net of
        Federal tax benefit             (40)         (34)         (21)
      Research and development credit    41           75           95
      Earnings of the Puerto Rican
        subsidiary, net of Puerto
        Rico Corporate tax and
        Tollgate tax                    188          214          348
      Earnings of the Foreign Sales
        Corporation                       7            7           16
      Tax-exempt portion of
        investment income                96          202          137
      Change in valuation allowance  (1,807)        (100)          74
      Losses of foreign entities
        generating no current tax
        benefit                        (526)        (380)         (79)
      Nondeductible expenses           (324)        (269)        (251)
      Utilization of tax operating
        and capital loss
        carryforwards                                              61
      Other                              50           67           56
                                      -----        -----          ---
    Income tax provision (benefit)
      at statutory tax rate of 34%
      in 1998 and 1997 and 35% in
      1996                          $(1,882)     $(1,540)        $679
                                      =====        =====          ===

  The Company has an agreement with the Commonwealth of Puerto Rico
    pursuant to which its operations in Puerto Rico are subject to a
    partial tax exemption which expires January 23, 2007.  Commonwealth
    taxes are currently being provided on earnings of the subsidiary.

  The U.S. Federal income tax returns of the Company through May 28,
    1994 have been closed by the Internal Revenue Service.





                                  -57-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE I - DEBT

  Short-term debt consists of the following:

                                                  May 30,      May 31,
                                                   1998         1997
                                                  ------       ------
                                                     (in thousands)

    Bank, lines of credit
      6.50% (1)                                   $1,961
      4.75% (1)                                               $   546
      7.16% to 7.25%                                            5,000
      7.75%                                                       846
    Japanese bank
      2.13% note (2)                               1,080
      2.63% note                                                  430
    Other financial institutions
      5.99% note, unsecured                                       207
                                                   -----        -----
                                                  $3,041       $7,029
                                                   =====        =====

  Long-term debt consists of the following:

                                                  May 30,      May 31,
                                                   1998         1997
                                                  ------       ------
                                                     (in thousands)

    Japanese bank loan, due November 2007,
      2.63% (2)                                     $298       $  754
    Japanese bank loan, due November 2004,
      1.80% (2)                                      252
    Canadian bank loan, due November 1999,
      7.00% (3)                                      343          605
                                                     ---        -----
                                                     893        1,359
    Less current maturities                          287          517
                                                     ---        -----
                                                    $606       $  842
                                                     ===        =====

  (1) The Company's Canadian subsidiary has available $3,432,000
      (Canadian $5,000,000) under this line of credit with a bank,
      which is collateralized by accounts receivable and inventory and
      expires on September 30, 1998.

  (2) Guaranteed by the Company and collateralized by property, plant
      and equipment having a net carrying value of $1,860,000 at May
      30, 1998.



                                  -58-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE I - DEBT (continued)

  (3) Collateralized by accounts receivable and $686,000 (Canadian
      $1,000,000) in machinery and equipment.

  The Company also has available $4,000,000 under an unsecured line of
    credit with a bank, which expires on September 30, 1998.  At May
    30, 1998, no amounts were outstanding under this line of credit.

  AngioDynamics has available $1,000,000 under an unsecured line of
    credit with a bank, which is guaranteed by the Company and expires
    on September 30, 1998.  At May 30, 1998, no amounts were
    outstanding under this line of credit.

  AngioDynamics' Irish subsidiary has available $426,000 (Irish Punts
    300,000) under this unsecured line of credit with a bank, which is
    guaranteed by the Company and expires on July 31, 1998.  At May 30,
    1998, no amounts were outstanding under this line of credit.

  The Company believes that the carrying amount of its debt
    approximates the fair value as the variable interest rates
    approximate current prevailing interest rates.

  During 1998, 1997 and 1996, the weighted average interest rates on
    short-term debt were 6.38%, 6.19% and 5.93%, respectively.


NOTE J - ACCRUED LIABILITIES

  Accrued liabilities consist of the following:

                                                  May 30,      May 31,
                                                   1998         1997
                                                  ------       ------
                                                     (in thousands)

    Payroll and related expenses                  $3,792       $3,006
    Accrued sales rebates                          1,421        1,940
    Other                                          1,745        1,883
                                                   -----        -----
                                                  $6,958       $6,829
                                                   =====        =====


NOTE K - RETIREMENT PLANS

  E-Z-EM, Inc. and certain domestic subsidiaries ("E-Z-EM") provide
    pension benefits through three Profit-Sharing Plans, under which
    E-Z-EM makes discretionary contributions to eligible employees, and
    three companion 401(k) Plans, under which eligible employees can
    defer a portion of their annual compensation, part of which is
    matched by E-Z-EM.  These plans cover all E-Z-EM employees not

                                  -59-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE K - RETIREMENT PLANS (continued)

    otherwise covered by collective bargaining agreements.  In 1998,
    1997 and 1996, profit-sharing contributions were $534,000, $507,000
    and $468,000, respectively, and 401(k) matching contributions were
    $341,000, $328,000 and $316,000, respectively.

  E-Z-EM also contributed $42,000, $52,000 and $42,000 in 1998, 1997
    and 1996, respectively, to a multiemployer pension plan for
    employees covered by a collective bargaining agreement.  This plan
    is not administered by E-Z-EM and contributions are determined in
    accordance with provisions of negotiated labor contracts.

  E-Z-EM Canada Inc., a wholly-owned subsidiary of the Company, also
    provides pension benefits to eligible employees through a Defined
    Contribution Plan.  In 1998, 1997 and 1996, contributions were
    $65,000, $55,000 and $45,000, respectively.


NOTE L - COMMITMENTS AND CONTINGENCIES

  During August and December 1997, the Company settled two product
    liability actions in which it had been a defendant.  Such actions
    were settled for amounts under the Company's insurance limit and
    the amounts contributed by the Company were not material to its
    consolidated financial statements.

  During April 1998, the Company settled a lawsuit brought upon by
    Olympia Holding Corporation p/k/a P-I-E Nationwide, Inc. for
    alleged undercharges for freight carriage.  Such lawsuit was
    settled for an amount under the Company's insurance limit and the
    amount contributed by the Company was not material to its
    consolidated financial statements.









                                  -60-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE L - COMMITMENTS AND CONTINGENCIES (continued)

  The Company leases several facilities from related parties.  During
    1998, 1997 and 1996, aggregate rental costs under all operating
    leases from continuing operations, which primarily consist of
    facility rentals, were approximately $1,325,000, $1,216,000 and
    $1,131,000, respectively, of which approximately $196,000, $197,000
    and $202,000 were paid to related parties.  Future annual
    operating lease payments in the aggregate, which include escalation
    clauses and real estate taxes, with initial remaining terms of more
    than one year at May 30, 1998, are summarized as follows:

                                                          Related
                                             Total         party
                                            leases        leases
                                            ------        -------
                                                (in thousands)

                    1999                    $  850          $ 75
                    2000                       583            50
                    2001                       448            21
                    2002                       408
                    2003                       393
                    Thereafter               1,719
                                             -----           ---
                                            $4,401          $146
                                             =====           ===

  The Company has an employment contract with a key executive that
    provides for a term of eight years.  Future annual commitments with
    respect to this contract at May 30, 1998, are summarized as
    follows:

                                                       (in thousands)

                    1999                                    $250
                    2000                                     250
                    2001                                     250
                    2002                                     125
                                                             ---
                                                            $875
                                                             ===











                                  -61-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE M - COMMON STOCK

  In August 1983, the Company adopted a Stock Option Plan (the "1983
    Plan").  The 1983 Plan provides for the grant to key employees of
    both nonqualified stock options and incentive stock options.  A
    total of 1,817,974 shares of the Company's Common Stock may be
    issued under the 1983 Plan pursuant to the exercise of options.
    All stock options must have an exercise price of not less than the
    market value of the shares on the date of grant.  Options will be
    exercisable over a period of time to be designated by the
    administrators of the 1983 Plan (but not more than 10 years from
    the date of grant) and will be subject to such other terms and
    conditions as the administrators may determine.  The 1983 Plan
    terminates in December 2005.

  In August 1984, the Company adopted a second Stock Option Plan (the
    "1984 Plan").  The 1984 Plan provides for the grant to members of
    the Board of Directors and consultants of nonqualified stock
    options.  A total of 459,490 shares of the Company's Common Stock
    may be issued under the 1984 Plan pursuant to the exercise of
    options.  All stock options must have an exercise price of not less
    than the market value of the shares on the date of grant.  Options
    will be exercisable over a period of time to be designated by the
    administrators of the 1984 Plan (but not more than 10 years from
    the date of grant) and will be subject to such other terms and
    conditions as the administrators may determine.  The 1984 Plan
    terminates in December 2005.

  In March 1997, the Company's AngioDynamics subsidiary adopted a Stock
    Option Plan (the "1997 Plan").  The 1997 Plan provides for the
    grant to key employees of both nonqualified stock options and
    incentive stock options and to members of the Board of Directors
    and consultants of nonqualified stock options.  A total of 136.36
    shares of AngioDynamics' Class B Common Stock may be issued under
    the 1997 Plan pursuant to the exercise of options.  All stock
    options must have an exercise price of not less than the market
    value of the shares on the date of grant.  Options will be
    exercisable over a period of time to be designated by the
    administrators of the 1997 Plan (but not more than 10 years from
    the date of grant) and will be subject to such other terms and
    conditions as the administrators may determine.  The 1997 Plan
    terminates in March 2007.  As a result of the 1997 Plan, the
    Company's equity interest in AngioDynamics may become diluted by as
    much as 12%.

  Effective in 1997, the Company adopted Statement of Financial
    Accounting Standards No. 123, "Accounting for Stock-Based
    Compensation" ("SFAS 123").  SFAS 123 allows for a choice of the
    method of accounting used for stock-based compensation.  Entities
    may elect the "intrinsic value" method based on APB Opinion No. 25,
    "Accounting for Stock Issued to Employees" or the new "fair value"

                                  -62-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE M - COMMON STOCK (continued)

    method contained in SFAS 123.  The Company elected to continue to
    account for stock-based compensation under the guidelines of APB
    Opinion No. 25.  Accordingly, no compensation expense has been
    recognized under these plans concerning options granted to key
    employees and to members of the Board of Directors, as such options
    were granted to Board members in their capacity as Directors.
    Compensation expense of $7,000 and $2,000 in 1998 and 1997,
    respectively, was recognized under these plans for options granted
    to consultants.  The Company has adopted the disclosure provisions
    of SFAS 123.

  If the Company had elected to recognize compensation expense based
    upon the fair value at the grant date for options granted under
    these plans to key employees and to members of the Board of
    Directors, consistent with the methodology prescribed by SFAS 123,
    the Company's pro forma net earnings (loss) and earnings (loss) per
    common share would be as follows:

                                      1998         1997         1996
                                     ------       ------       ------
                                  (in thousands, except per share data)

      Net earnings (loss)
        As reported                 $(5,967)     $(3,208)     $21,008
        Pro forma                    (6,549)      (3,672)      20,730

      Basic earnings (loss) per
        common share
          As reported                 $(.60)       $(.33)       $2.16
          Pro forma                    (.66)        (.37)        2.13

      Diluted earnings (loss) per
        common share
          As reported                 $(.60)       $(.33)       $2.04
          Pro forma                    (.66)        (.37)        2.01

  These pro forma amounts may not be representative of future
    disclosures because they do not take into effect pro forma
    compensation expense related to grants made before 1996.  The fair
    value of options was estimated at the date of grant using the
    Black-Scholes option-pricing model with the following weighted-
    average assumptions for 1998, 1997 and 1996, respectively:
    dividend yields of zero for all years; expected volatility ranging
    from 43.89% to 47.30% in 1998, from 46.90% to 47.61% in 1997 and
    from 47.49% to 49.75% in 1996; risk-free interest rates ranging
    from 5.61% to 6.35% in 1998, from 5.90% to 7.09% in 1997 and from
    5.47% to 6.65% in 1996; and expected terms ranging from 5 to 9 1/2
    years in 1998, 5 and 9 1/2 years in 1997 and 5 years in 1996.


                                  -63-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE M - COMMON STOCK (continued)

  A summary of the status of the Company's stock option plans as of May
    30, 1998, May 31, 1997 and June 1, 1996, and changes for the three
    years then ended, is presented below:

                           1998             1997             1996
                     ---------------- ---------------- ----------------
                             Weighted         Weighted         Weighted
                             -Average         -Average         -Average
                     Shares  Exercise Shares  Exercise Shares  Exercise
                     (000)    Price   (000)    Price   (000)    Price
                     ------  -------- ------  -------- ------  --------

  1983 Plan
  ---------
  Outstanding at
    beginning of
    year              1,115     $4.90  1,225    $ 4.90  1,330     $4.75
  Granted                                 11    $10.13     86     $8.65
  Exercised            (107)    $4.48   (118)   $ 5.19   (146)    $5.23
  Forfeited              (5)    $7.01     (3)   $ 8.77    (27)    $4.79
  Expired                (1)    $8.74                     (18)    $9.23
                      -----            -----            -----
  Outstanding at
    end of year       1,002     $4.94  1,115    $ 4.90  1,225     $4.90
                      =====            =====            =====

  Options exercisable
    at year-end         995    $ 4.91  1,100     $4.86    672     $4.85

  Weighted-average
    fair value of
    options granted
    during the year                              $5.13            $4.41

  1984 Plan
  ---------
  Outstanding at
    beginning of
    year                305     $5.60    306    $ 5.65    259    $ 5.27
  Granted                 6     $5.88     16    $ 9.32     55    $ 8.36
  Exercised                                                (2)   $ 4.71
  Expired                (7)    $9.53    (17)   $10.00     (6)   $15.03
                        ---              ---              ---
  Outstanding at
    end of year         304     $5.51    305    $ 5.60    306    $ 5.65
                        ===              ===              ===

  Options exercisable
    at year-end         293     $5.47    283    $ 5.24    197    $ 5.53

  Weighted-average
    fair value of
    options granted
    during the year             $2.72           $ 4.76           $ 4.31


                                  -64-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE M - COMMON STOCK (continued)

                           1998             1997
                     ---------------- ----------------
                             Weighted         Weighted
                             -Average         -Average
                             Exercise         Exercise
                     Shares   Price   Shares   Price
                     ------  -------- ------  --------

  1997 Plan
  ---------
  Outstanding at
    beginning of
    year             122.39   $80,000
  Granted            140.63   $43,022 122.39   $80,000
  Forfeited         (133.01)  $80,000
                     ------           ------
  Outstanding at
    end of year      130.00   $40,000 122.39   $80,000
                     ======           ======

  Options exercisable
    at year-end        None             None

  Weighted-average
    fair value of
    options granted
    during the year           $24,877          $36,463

  The following information applies to options outstanding and
    exercisable at May 30, 1998:

                              Outstanding               Exercisable
                     ------------------------------  ------------------
                               Weighted-
                      Number    Average   Weighted-  Number   Weighted-
                       Out-    Remaining   Average    Exer-    Average
     Range of        standing   Life in   Exercise   cisable  Exercise
  Exercise Prices     (000)      Years      Price     (000)     Price
  ---------------    --------  ---------  ---------  -------  ---------

     1983 Plan
     ---------
   $3.66 to $5.39        880      5.92      $4.45      878      $4.45
  $7.54 to $10.68        122      5.90      $8.46      117      $8.38
                       -----                           ---
                       1,002                           995
                       =====                           ===

     1984 Plan
     ---------
   $3.66 to $5.49        214      6.44      $4.15      214      $4.15
   $5.88 to $8.58         66      6.64      $7.93       55      $8.21
  $9.58 to $12.49         24      6.37     $10.93       24     $10.93
                         ---                           ---
                         304                           293
                         ===                           ===


                                  -65-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE M - COMMON STOCK (continued)

  On May 30, 1998, there remained 218,014, 113,259 and 6.36 shares
    available for granting of options under the 1983, 1984 and 1997
    Plans, respectively.

  Options granted prior to the Company's recapitalization on October
    26, 1992 are exercisable one-half in Class A Common Stock and one-
    half in Class B Common Stock.  Options granted after the
    recapitalization are exercisable in Class B Common Stock.

  On May 5, 1998, the Company's Board of Directors approved the
    repricing of all outstanding stock options previously granted under
    the 1997 Plan.  The repricing provided for the exercise price of
    128.41 options to be reduced from $80,000 per share to $40,000 per
    share, to reflect current fair value.  The repricing did not affect
    the term or vesting period of the options.

  In August 1985, the Company adopted an Employee Stock Purchase Plan
    (the "Employee Plan").  The Employee Plan provides for the purchase
    by employees of the Company's Class B Common Stock at a discounted
    price of 85% of the market value of the shares on the date of
    purchase.  A total of 150,000 shares of the Company's Class B Stock
    may be purchased under the Employee Plan which terminates on
    September 30, 1998.  During 1998, employees purchased 1,025 shares,
    at prices ranging from $5.95 to $7.01.  Total proceeds received by
    the Company approximated $6,000.

  On January 23, 1996, the Board of Directors declared a 3% stock
    dividend on shares of Class A and Class B Common Stock.  The
    dividend, payable in nonvoting Class B Stock, was distributed on
    March 15, 1996 to shareholders of record on February 23, 1996.  On
    March 4, 1997, the Board of Directors declared a 3% stock
    dividend on shares of Class A and Class B Common Stock.  The
    dividend, payable in nonvoting Class B Stock, was distributed on
    April 21, 1997 to shareholders of record on March 31, 1997.  On
    January 23, 1998, the Board of Directors declared a 3% stock
    dividend on shares of Class A and Class B Common Stock.  The
    dividend, payable in nonvoting Class B Stock, was distributed on
    March 16, 1998 to shareholders of record on February 26, 1998.
    Earnings (loss) per common share have been retroactively adjusted
    to reflect the stock dividends.










                                  -66-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE N - RELATED PARTIES

  During 1998, the Company entered into split dollar life insurance
    arrangements with a key executive (including his spouse) and a
    principal shareholder (the "insureds").  On an annual basis, the
    Company makes interest bearing advances of approximately $100,000
    per insured toward the cost of such life insurance policies.
    Interest on the advances is to be paid to the Company annually by
    the insureds.  Under collateral assignment agreements, the proceeds
    from the policies will first be paid to the Company to repay the
    advances it made.  If the policies are terminated prior to the
    death of the insured, the Company will be entitled to the cash
    surrender value of the policies at that time, and any shortfall
    between that amount and the amount of the advances made by the
    Company will be repaid to the Company by the insureds.  At May 30,
    1998, advances of $200,000 are recorded in the consolidated balance
    sheet under the caption "Other Assets".

  The Company has an unsecured, two-year interest bearing note
    receivable from an executive officer in the principal amount of
    $320,000.  The outstanding principal and interest matures on
    September 30, 1999.

  A director provided consulting services to the Company during 1998,
    1997 and 1996.  Fees for such services, including fees relating to
    attendance at directors' meetings, were approximately $99,000,
    $333,000 and $319,000 during 1998, 1997 and 1996, respectively.  In
    connection with the sale of SDI during 1996, this director resigned
    as a director of SDI and received an investment banker's fee of
    $905,000, a bonus of $191,000 arising from the sale and a payment
    of $268,000 in connection with the surrender of outstanding stock
    options in SDI.

  In connection with the sale of SDI during 1996, an executive officer
    resigned as a director of SDI and received a bonus of $191,000
    arising from the sale and a payment of $268,000 in connection with
    the surrender of outstanding stock options in SDI.

  Three other directors provided consulting services to the Company
    during 1998, 1997 and 1996.  Fees for such services, including fees
    relating to attendance at directors' meetings, were approximately
    $198,000, $192,000 and $227,000 during 1998, 1997 and 1996,
    respectively.









                                  -67-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE O - INDUSTRY SEGMENT AND GEOGRAPHIC AREA OPERATIONS

  The Company is engaged in the manufacture and distribution of a wide
    variety of products which are classified into two industry
    segments:  Diagnostic products and AngioDynamics products.
    Diagnostic products encompass both contrast systems, consisting of
    barium sulfate formulations and related medical devices used in
    X-ray, CT-scanning, ultrasound and MRI imaging examinations, and
    non-contrast systems, including diagnostic radiology devices,
    custom contract pharmaceuticals, gastrointestinal cleansing
    laxatives, X-ray protection equipment, and immunoassay tests.
    AngioDynamics products include angiography, therapeutic and
    stent/angioplasty medical devices used in the interventional
    medicine marketplace.  The Company's primary business activity is
    conducted with radiologists and hospitals, located throughout the
    U.S. and abroad, through numerous distributors.  The Company's
    exposure to credit risk is dependent, to a certain extent, on the
    healthcare industry.  The Company performs ongoing credit
    evaluations of its customers and does not generally require
    collateral; however, in certain circumstances, the Company may
    require letters of credit from its customers.

  In the tables below, operating profit (loss) from continuing
    operations includes total net sales less operating expenses.
    Identifiable assets are those associated with industry segment or
    geographic area operations, excluding loans to or investments in
    another industry segment or geographic area operation.

  In 1998, 1997 and 1996, there was one customer to whom sales of
    Diagnostic products represented 16%, 15% and 16% of total sales,
    respectively.  Approximately 19% of accounts receivable pertained
    to this customer at May 30, 1998 and May 31, 1997, respectively.




















                                  -68-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE O - INDUSTRY SEGMENT AND GEOGRAPHIC AREA OPERATIONS (continued)

  Industry Segments                   1998         1997         1996
  -----------------                  ------       ------       ------
                                              (in thousands)
    Net Sales
      Diagnostic products          $ 83,566      $80,838      $80,936
      AngioDynamics products         19,892       18,662       11,696
      Eliminations                     (574)      (2,176)        (700)
                                    -------       ------       ------
    Total Net Sales                $102,884      $97,324      $91,932
                                    =======       ======       ======

    Operating Profit (Loss)
      Diagnostic products           $ 1,988      $(1,088)      $2,509
      AngioDynamics products         (7,317)*     (3,816)      (1,536)
      Eliminations                      (22)          (7)         (16)
                                      -----        -----        -----
    Total Operating Profit (Loss)   $(5,351)     $(4,911)      $  957
                                      =====        =====        =====

    Identifiable Assets
      Diagnostic products           $72,124     $ 76,576      $83,304
      AngioDynamics products         19,631 *     25,515       12,945
      Eliminations                   (1,049)      (1,371)        (212)
                                     ------      -------       ------
    Total Identifiable Assets       $90,706     $100,720      $96,037
                                     ======      =======       ======

    Depreciation and Amortization
      Diagnostic products            $2,361       $2,437       $2,111
      AngioDynamics products            954          600          317
      Discontinued operation                                      124
                                      -----        -----        -----
    Total Depreciation and
      Amortization                   $3,315       $3,037       $2,552
                                      =====        =====        =====

    Capital Expenditures
      Diagnostic products            $1,745       $1,484       $3,850
      AngioDynamics products            152        2,886          370
      Discontinued operation                                       11
                                      -----        -----        -----
    Total Capital Expenditures       $1,897       $4,370       $4,231
                                      =====        =====        =====

* Includes an impairment charge of $4,121,000.  See Note B - Asset
  Purchase and Impairment Charge.





                                  -69-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE O - INDUSTRY SEGMENT AND GEOGRAPHIC AREA OPERATIONS (continued)

  Geographic Areas
  ----------------
    The following geographic area data includes net sales, operating
      profit (loss) generated by and assets employed in operations
      located in each area:

                                      1998         1997         1996
                                     ------       ------       ------
                                              (in thousands)
    Net Sales
      U.S. operations              $ 84,459      $80,190      $71,939
      International operations:
        Canada                       20,321       14,369       12,254
        Other                        11,238       12,555       13,456
      Eliminations                  (13,134)      (9,790)      (5,717)
                                    -------       ------       ------
    Total Net Sales                $102,884      $97,324      $91,932
                                    =======       ======       ======

    Operating Profit (Loss)
      U.S. operations               $(6,454)     $(3,439)      $1,084
      International operations:
        Canada                          867       (1,518)        (410)
        Other                           208          175          225
      Eliminations                       28         (129)          58
                                      -----        -----        -----
    Total Operating Profit (Loss)   $(5,351)     $(4,911)      $  957
                                      =====        =====        =====

    Identifiable Assets
      U.S. operations               $67,705     $ 78,706      $73,604
      International operations:
        Canada                       17,423       15,496       15,543
        Other                         8,568        7,772        8,067
      Eliminations                   (2,990)      (1,254)      (1,177)
                                     ------      -------       ------
    Total Identifiable Assets       $90,706     $100,720      $96,037
                                     ======      =======       ======













                                  -70-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE O - INDUSTRY SEGMENT AND GEOGRAPHIC AREA OPERATIONS (continued)

  The Company's domestic export sales by geographic area are summarized
    as follows:

                                      1998         1997         1996
                                     ------       ------       ------
                                              (in thousands)

      Europe                        $ 6,974      $ 9,252       $5,655
      Other                           6,169        6,098        3,783
                                     ------       ------        -----
                                    $13,143      $15,350       $9,438
                                     ======       ======        =====


NOTE P - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

  Quarterly results of operations during 1998 and 1997 were as follows:

                                                  1998
                                   ----------------------------------
                                    First   Second    Third   Fourth
                                   quarter  quarter  quarter  quarter
                                   -------  -------  -------  -------
                                  (in thousands, except per share data)

    Net sales                      $25,713  $24,711  $24,385  $28,075
    Gross profit                     9,735    8,721    8,239   10,738
    Net earnings (loss)                128   (1,375)  (5,819)   1,099
    Earnings (loss) per common
      share (1)
        Basic and diluted              .01     (.14)    (.58)     .11

                                                  1997
                                   ----------------------------------
                                    First   Second    Third   Fourth
                                   quarter  quarter  quarter  quarter
                                   -------  -------  -------  -------
                                  (in thousands, except per share data)

    Net sales                      $23,355  $25,992  $23,576  $24,401
    Gross profit                     9,865   10,251    8,622    7,832
    Net earnings (loss)                513      243   (1,046)  (2,918)
    Earnings (loss) per common
      share (1)
        Basic and diluted              .05      .02     (.11)    (.29)

  (1) Earnings (loss) per common share have been retroactively restated
      to reflect the total shares issued after the 3% stock dividends
      described in Note M.

  The third quarter of 1998 includes an impairment charge of
    $4,121,000.  See Note B - Asset Purchase and Impairment Charge.



                                  -71-
<PAGE>

                     E-Z-EM, Inc. and Subsidiaries

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

              May 30, 1998, May 31, 1997 and June 1, 1996


NOTE P - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED) (continued)

  The fourth quarter of 1997 was adversely affected by certain
    adjustments pertaining to the Company's AngioDynamics segment.  The
    significant adjustments included the write-off of expenses relating
    to the proposed initial public offering of AngioDynamics and the
    effects of the sales price erosion of coronary stents in the
    European market.








                                  -72-
<PAGE>


                     E-Z-EM, Inc. and Subsidiaries

            SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                             (in thousands)


     Column A       Column B        Column C         Column D  Column E
     --------       --------        --------         --------  --------
                                    Additions
                              ---------------------
                                 (1)        (2)
                     Balance             Charged to             Balance
                       at     Charged to   other                at end
                    beginning costs and  accounts-  Deductions-   of
    Description     of period  expenses   describe    describe  period
    -----------     --------- ---------- ---------- ----------- -------

Fifty-two weeks
  ended June 1, 1996

Allowance for
  doubtful accounts..  $465     $176                  $114 (a)    $527
                        ===      ===                   ===         ===

Fifty-two weeks
  ended May 31, 1997

Allowance for
  doubtful accounts..  $527     $451                  $ 48 (b)    $930
                        ===      ===                   ===         ===

Fifty-two weeks
  ended May 30, 1998

Allowance for
  doubtful accounts..  $930     $286                  $ 68 (b)  $1,148
                        ===      ===                   ===       =====

(a) Represents amounts written off as uncollectible of $64,000 and an
    amount deducted in conjunction with the sale of SDI of $50,000.

(b) Amounts written off as uncollectible.


















                                  -73-